As a comparatively quiet local trading session came to an end the New Zealand Dollar was little-changed against its major peers.
The ‘Kiwi’ was barely affected by a report showing that credit card spending in New Zealand increased by 1.0 per cent in January, month-on-month, wiping out December’s positively revised 0.7 per cent decline.
Domestic spending increased by 1.1 per cent month-on-month while overseas spending was 1.8 per cent higher.
Year-on-year card spending increased by 9.2 per cent last month, almost double the 4.7 per cent annual gain recorded at the close of 2013.
The New Zealand Dollar was holding steady against its currency counterparts after this data was published.
However, as European trading progressed the New Zealand Dollar edged lower against the Pound as the British currency was supported by hawkish comments made by Bank of England Governor Mark Carney.
Sterling was lifted as Carney asserted that the BoE remains committed to supporting the UK’s economic recovery.
In the opinion of currency strategist Paul Robson; ‘As long as the data hold up, the markets will bring forward their expected start of tightening from the Bank of England and that plays supportive for Sterling. Sterling had been heavily oversold in the last five years and signs that maybe we’re got a little bit more momentum behind the recovery allows Sterling to do well.’
With influential economic data for New Zealand rather thin on the ground this week, investors are expecting the ‘Kiwi’ to trade in a fairly narrow range in the days ahead.
Tomorrow’s Reserve Bank of New Zealand 2-year inflation expectation report and Wednesday’s trade balance figures for New Zealand will be worthy of note, but volatility in the GBP/NZD pairing is more likely to be occasioned by UK home loans/CBI reported sales figures, Wednesday’s fourth quarter growth reports and Friday’s consumer confidence survey.
Developments in the US will also be of interest, with US growth, University of Michigan Confidence and US durable goods orders being particularly influential.
On Thursday Federal Reserve Chairman Janet Yellen is also scheduled to testify to the senate on monetary policy. Although Yellen has claimed to be supportive of continuity in the Fed’s fiscal policy – intimating that the steady tapering of stimulus would continue – less than impressive US data could occasion a change of heart.
New Zealand Dollar (NZD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
New Zealand Dollar,
,US Dollar,0.8288,
New Zealand Dollar,,Euro,0.6023,
New Zealand Dollar,,Australian Dollar,0.9236 ,
New Zealand Dollar,,Pound Sterling,0.4983,
US Dollar,,New Zealand Dollar,1.2045 ,
Euro,,New Zealand Dollar,1.6593 ,
Australian Dollar,,New Zealand Dollar,1.0840 ,
Pound Sterling,,New Zealand Dollar, 2.0068 ,
[/table]
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