NZ dollar drifts ahead of key meetings
Tue, 23 Oct 2012 10:24p.m.
The New Zealand dollar was little changed in local trading as investors gear up for central bank meetings in the US, Canada and New Zealand and for Australian inflation figures.
The kiwi traded at 81.66 US cents at 5pm in Wellington from 81.59 cents at 8am and 81.73 cents on Monday in Asia.
The trade-weighted index was little changed at 72.82 from 72.83.
New Reserve Bank of New Zealand governor Graeme Wheeler will mark his first official cash rate review on Thursday and is expected to keep the benchmark rate at 2.5 per cent.
That's against the backdrop of tepid inflation that's giving him scope to loosen monetary policy if he needs to give the economy a rev up.
"The full monetary policy statement in December will be way more revealing," said Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney.
"The RBNZ is definitely the big thing" for the kiwi this week, he said.
Investors will also keep tabs on the Federal Open Market Committee meeting in the US where the Fed may flesh out its plans to unwind "Operation Twist", where it buys longer-dated debt and sells bonds with shorter maturities.
The Bank of Canada governor Mark Carney is expected to talk down a tightening bias at a policy review, and keep the target for the overnight rate at one per cent.
Traders will watch Australia's third-quarter consumer price figures on Wednesday, which are expected to show an accelerating pace of quarterly inflation.
The kiwi dollar weakened to 79.12 Australian cents from 79.24 cents on Monday.
It rose to 65.18 yen from 64.84 yen and fell to 62.54 euro cents from 62.68 cents.
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