New Zealand dollar hits two-month high

The local currency followed investor sentiment as it ebbed and flowed with Chinese markets re-opening after the Lunar New Year holiday last week. Photo / iStock

The New Zealand dollar touched a two-month high as the greenback slid following a mixed report on the US jobs market.

The kiwi hit 68.19 US cents, and was trading at 68.12 cents at 8am in Wellington, from 68.07 cents at the New York close and 67.48 cents at 5pm on Friday. The trade-weighted index increased to 73.07 from 72.82 on Friday.

The US dollar index, which measures the greenback against a basket of currencies, sank to its lowest in more than a week after the key US non-farm payrolls report, which is closely watched by the Federal Reserve, showed a mix result for February.

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While the number of jobs created in the month beat expectations at 242,000, average hourly earnings fell, suggesting inflation remains muted and will probably prompt the Fed to hold off on hiking interest rates anytime soon.

"While non-farm payrolls for February beat expectations (and there were upward revision to the previous two months), the unemployment rate was steady at 4.9 per cent and wage pressures were apparently absent," Bank of New Zealand senior market strategist Kymberly Martin said in a note.

"While the overall message was of continued improvement in the labour market, it was not too hot for markets to fear imminent Fed action."

In New Zealand today, fourth-quarter wholesale trade data is released at 10:45am.
The New Zealand dollar advanced to 4.4323 yuan from 4.3968 yuan on Friday after the China's National People's Congress announced at the weekend that the country's 2016 growth target is 6.5 per cent to 7 per cent, and set its budget deficit target for 2016 at 3 per cent of gross domestic product from 2.3 per cent in 2015.

The local currency gained to 91.76 Australian cents from 91.56 cents on Friday, rose to 61.88 euro cents from 61.64 cents, increased to 77.49 yen from 76.70 yen, and advanced to 47.87 British pence from 47.66 pence.