NZ dollar falls after central bank governor keep door open for May rate cut
"It is a really mixed picture, it's just hard," Orr said in an interview with Bloomberg in Wellington on Thursday. "I don't know yet" whether there will be a cut in May, he said.
- Country:
- New Zealand
The New Zealand dollar fell against the greenback after the central bank governor kept the door open for a May rate cut and as strong US labour market data eased fears of a possible slowdown in the economy there.
The kiwi was trading at 67.28 US cents at 8 am in Wellington from 67.62 at 5 am. The trade-weighted index was at 73.02 points from 73.24.
"It is a really mixed picture, it's just hard," Orr said in an interview with Bloomberg in Wellington on Thursday. "I don't know yet" whether there will be a cut in May, he said.
Markets were surprised last month when the central bank switched to an easing bias saying its next move would likely be a rate cut. Next month's decision will be the first to be made by the central bank's new Monetary Policy Committee, which includes four internal members and three external members. Orr reiterated in the interview that the starting point for that committee will be the RBNZ's latest policy stance.
The interview "promoted some initial negativity wobbles," in the New Zealand dollar, said Mike Shirley, a senior dealer at Kiwibank. However, "it wasn't really a kiwi dollar weakness story, it was more a US dollar strength story," he said.
In the US, initial claims for state unemployment benefits fell 8,000 to a seasonally adjusted 196,000 for the week ended April 6, the Labor Department said. That was the lowest level since Oct. 4, 1969, when it was 193,000 and the labour market was considerably smaller.
"That helped support that US dollar strength story," said Shirley.
The New Zealand dollar was at 94.48 Australian cents from 94.43, at 51.53 British pence from 51.59, at 59.77 euro cents from 59.95, at 75.13 Japanese yen from 75.11, and at 4.5220 Chinese yuan from 4.5401.
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