"Locally, general election jitters will continue, and combined with further softening in house prices and dairy future prices, will cap NZD," said Con Williams, rural economist at ANZ Bank New Zealand. "Sentiment toward the USD remains downbeat, and geopolitical and political news will continue to drive movements."
Today, traders will be watching for retail spending on electronic cards for August, due for release this morning. On Friday, New York Federal Reserve President William Dudley said that major storms tended to lift economic activity over the longer term, though Hurricanes Harvey and Irma might impact the timing of the next US interest rate hike. He signalled the central bank would likely proceed with the unwinding of its balance sheet.
Traders will also be watching for any further impact on the yuan after the People's Bank of China said it would remove a 20 per cent foreign exchange margin for financial institutions buying US dollars, a move that may signal discomfort with the strong Chinese currency against the greenback which hurts exporters.
The kiwi dollar traded at 4.7064 yuan from 4.7045 yuan in New York and down from 4.7221 yuan in Wellington at the end of last week. It traded at 90.05 Australian cents from 90.11 cents in New York and gained to 78.68 yen from 78.32 yen. It was at 55.10 British pence from 55.02 pence and rose to 60.48 euro cents from 60.34 cents.
