New Zealand Dollar Trades Higher After RBNZ Chief Orr's Comments
September 25 2019 - 11:46PM
RTTF2
The New Zealand dollar strengthened against its major
counterparts in the Asian session on Thursday, after Reserve Bank
governor Adrian Orr said that the bank is unlikely to use
unconventional monetary policy measures as the economy is in a
better position.
"Our current view is that we are unlikely to need
'unconventional' monetary policy tools. But we would be remiss not
to be prepared," Orr said to NZX Issuer Forum in Auckland.
Interest rates will remain low for a number of years, providing
a great environment to invest, he said.
"The good news for New Zealand, unlike many other OECD
economies, is that our government's books are in good shape, with
room to expand investment, and there is already a strong fiscal
impulse underway from public spending and investment," said
Orr.
RBNZ is currently thinking hard about questions on negative
interest rates and other strategies, because it makes sense to do
so as a precaution - it's best to put the roof on when the sun is
shining, he said.
The kiwi rose to 0.6311 against the greenback and 67.96 against
the yen, from its early lows of 0.6267 and 67.50, respectively. The
next possible resistance for the kiwi is seen around 0.66 against
the greenback and 71.00 against the yen.
The NZ currency advanced to 1.7368 against the euro and 1.0711
against the aussie, off its early low of 1.7466 and a 2-day low of
1.0771, respectively. The kiwi is likely to find resistance around
1.70 against the euro and 1.06 against the aussie.
Looking ahead, Eurozone M3 money supply for August and European
Central Bank's economic bulletin are due in the European
session.
At 9:30 am ET, European Central Bank President Mario Draghi will
deliver opening remarks at the European Systemic Risk Board annual
conference in Frankfurt.
Fifteen minutes later, Bank of England Governor Mark Carney is
set to participate in a panel discussion about the future of
financial services at the ESRB annual conference, in Frankfurt.
Federal Reserve Bank of St. Louis President James Bullard will
deliver remarks at an event hosted by the central bank at 10:00 am
ET.
U.S. GDP data for the second quarter, weekly jobless claims for
the week ended September 21, wholesale inventories and pending home
sales for August are scheduled for release in the New York
session.
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