NZ dollar gains against Australian dollar

The kiwi was trading at 95.23 Australian cents at 5pm.

The New Zealand dollar is mixed, gaining against the Australian dollar but little changed against the greenback, after downbeat growth and inflation forecasts from the Reserve Bank of Australia.

The kiwi was trading at 67.50 US cents at 5pm in Wellington from 67.54 at 8.15am and at 95.23 Australian cents from 95.13. The trade-weighted index was at 73.23 points from 73.21.

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The RBA forecasts cap off a horror week for the kiwi which has dropped nearly a cent-and-a-half from 68.96 US cents in New York last Friday.

After keeping its cash rate on hold earlier this week, the RBA's latest monetary policy statement today shows it now expects economic growth for Australia of 2.5 per cent for the year ending June, down from its previous forecast of 3.25 per cent.

Similarly, governor Philip Lowe now expects inflation of 1.25 per cent for the same period, down from the bank's previous 2 per cent expectation.

"That's been the main thing driving the Aussie dollar lower today and that's in the shadow of governor Lowe's speech the other day when he switched his tone from saying the next move would be up to it could be down," says Mitchell McIntyre, a corporate dealer at XE.

Yesterday's "less-than-great" employment numbers are also continuing to hurt the New Zealand dollar – the December quarter unemployment rate came in at 4.3 per cent, above expectations of 4.1 per cent.

Making the bad news worse, the participation rate was 70.9 percent compared with market expectations of 71.1 percent.

The tone for today had already been negative with global markets turning bearish again on continued anxiety about whether the United States and China will resolve their trade differences.

China is the largest trading partner of both Australia and New Zealand and Australia is New Zealand's second-largest trading partner.

CNBC reported overnight that President Donald Trump and China's President Xi Jinping are unlikely to meet before the March 2 deadline Trump set for imposing more tariffs on Chinese imports into the US.

That's because the two sides are running out of time to nut out a deal.

"People have been hoping for more progress but we haven't really seen any," McIntyre says.

"The antipodean currencies are a little bit loveless at the moment."

The New Zealand dollar is at 52.12 British pence from 52.09, at 59.52 euro cents from 59.24, at 74.08 yen from 74.15 and at 4.5513 Chinese yuan from 4.5533.

The two-year swap rate fell to 1.7808 per cent from 1.8072; the 10-year rate fell to 2.3925 per cent from 2.4275.