WELLINGTON: The New Zealand dollar is heading for a 3.7 per cent gain this week as investors reassess their bets on when the Federal Reserve will start hiking interest rates, and calmer global markets stoke demand for riskier assets such as equities and commodities.
The kiwi rose to 66.74 US cents at 5pm in Wellington from 64.34 cents on Friday in New York last week. The trade-weighted index advanced to 71.52 from 71.04 on Friday, and is heading for a 2.5 per cent weekly gain.
The Dollar Index, a measure of the greenback against a basket of currencies, is heading for a 0.6 per cent weekly decline as less robust economic data prompted traders to revisit their bets on when the Federal Open Market Committee will shift from the zero-rate monetary policy it’s run since December 2008.
Minutes to the FOMC’s last meeting showed policymakers deemed the world’s biggest economy is almost in good enough shape to warrant a hike, but held off for more evidence of a return to normality and to assess a wayward global economy.
Another gain in dairy prices at this week’s GlobalDairyTrade auction has also supported the kiwi dollar, and helped the local currency press higher against its Australian counterpart, which has faced languishing iron ore prices.
The kiwi slipped to 91.69 Australian cents at 5pm in Wellington from 91.83 cents on Friday, and rose to 4.2377 Chinese yuan from 4.1819 yuan.
The local currency climbed to 80.04 yen at 5pm in Wellington from 78.96 yen on Friday, and advanced to 59.15 euro cents from 58.52 cents. It climbed to 43.92 British pence from 43.02 pence on Friday.
