By Tina Morrison
April 1 (BusinessDesk) – The New Zealand dollar held steady against the US dollar after both countries saw gains in confidence surveys, signalling a positive outlook for their economies.
The kiwi was at 74.80 US cents at 8am in Wellington, from 74.79 cents at 5pm yesterday. The trade-weighted index was unchanged at 78.67.
The US dollar index, which measures the greenback against a basket of currencies, advanced after a report showed US consumer confidence rebounded in March, rising to 101.3 from 98.8 in February. Economists in a Reuters poll had expected the measure to fall to 96. A separate report showed US house prices rose in January. A report in New Zealand yesterday showed business confidence rose to a seven-month high in March.
“New Zealand business confidence may have strengthened, but US consumer confidence soared, providing a solid counterpoint to New Zealand dollar strength,” ANZ Bank New Zealand rural economist Con Williams and senior FX strategist Sam Tuck said in a note. “The ISM (manufacturing activity) release tonight may weaken the US dollar, as the regional Fed surveys suggest downside risk to current expectations.”
ANZ expects the kiwi to trade between 74.10 US cents and 75.40 cents today.
Traders will be eyeing this afternoon’s release of Chinese manufacturing data for March for a gauge on how Asia’s largest economy is tracking.
Early tomorrow, the focus will be on the GlobalDairyTrade auction, where prices are expected to decline after Fonterra Cooperative Group said it would increase its product volumes.
The New Zealand dollar rose to 98.23 Australian cents from 98.09 cents yesterday. The local currency touched 98.41 Australian cents overnight, close to yesterday’s post-float high of 98.43 cents, as slumping iron ore prices continued to weigh on the outlook for Australia’s economy.
The kiwi fell to 50.37 British pence from 50.59 pence yesterday after UK fourth-quarter GDP was revised higher to an annual 3 percent.
The local currency advanced to 69.63 euro cents from 69.22 cents amid continuing uncertainty about Greek debt talks, while it slipped to 89.72 yen from 89.94 yen,