New Zealand Dollar Weaker Against USD, Eyes on RBA

 
   By Rebecca Howard 
 

        WELLINGTON, New Zealand--The New Zealand dollar remained under pressure against the U.S. dollar on Friday but regained some ground against the Aussie, as investors await the Reserve Bank of Australia's decision on rates next week.
        The Kiwi lost more ground against the greenback as the market continues to digest the New Zealand central bank's move to an easing bias and after Finance Minister Bill English said the government was unlikely to reach its promised surplus this year.
        The Reserve Bank of New Zealand kept rates on hold Thursday, but left the door open for a possible cut, saying any future moves would depend on how inflationary pressures evolve.
        On Friday, Finance Minister Bill English said the New Zealand government is unlikely to return to its oft-promised budget surplus this year but a small deficit wouldn't pose an economic risk.
        In Wellington, the New Zealand dollar was at US$0.7587 late Friday versus US$0.7615 late Thursday and at A$0.9620 versus A$0.9533.
        Looking ahead, the main event will be the Reserve Bank of Australia's meeting next week. Financial markets attach a 50% probability to a possible rate cut on May 5, when the RBA's policy-setting board next meets.
        Any rate cut in Australia will fuel the New Zealand dollar against the Australian dollar as there would be a significant rate differential. New Zealand's cash rate is 3.5% while Australia's is 2.25%.
        Write to Rebecca Howard at rebecca.howard@wsj.com; @FarroHoward
        (END) Dow Jones Newswires

        May 01, 2015 01:07 ET (05:07 GMT)

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