The New Zealand dollar is little changed after the British parliament defeated Prime Minister Theresa May's Brexit plan by a historic 230 votes, leaving financial markets with continuing uncertainty as to how the situation will play out.

The kiwi was trading at 68.11 US cents at 5pm in Wellington from 68.06 at 8am while the trade weighted index was little changed at 73.68 points from 73.66.

See live rates for the NZ-US $ below. Click for more information:NzForex Foreign Exchange Transfers

Britain's Labour Party has tabled a vote of no confidence in May but Derek Rankin, director of Rankin Treasury Advisory, says he doesn't think that vote will succeed.

"They don't like the deal, but nobody wants her job," Rankin says.


Ahead of the Brexit vote May said she thinks Britain is more likely to remain in the EU rather than taking the "hard Brexit" route, currently scheduled for March 29 if no deal is agreed.

Rankin says those comments were "to scare the vote," and that it's quite likely the deadline will be extended although a hard Brexit still appears likely.

Whatever the Europeans offer is unlikely to be acceptable to Britain and whatever Britain demands is unlikely to be acceptable to the Europeans, he says.

The New Zealand dollar was trading at 53.00 British pence from 53.49

But, apart from such global influences, trading in the New Zealand dollar at the moment is largely being determined by trade flows.

That's because New Zealand no longer offers the attraction of high-interest rates – US interest rates are now higher – and much of the speculative flows have dried up, Rankin says.

That can be seen in holdings of government securities by non-residents – Reserve Bank figures show they had dropped to 54.1 per cent in November last year from 57.7 per cent a year earlier and from 60.6 per cent in November 2016.

On the trade front, importers were very active up until Christmas but now "they've pretty much packed up their importing operations and headed for the beach."


Exporters have started to trickle back to work this week but won't be fully on deck until next week, and the main export season will be getting underway next month, Rankin says. That may mean the New Zealand dollar is likely to rise through the next few months.

Against the Australian dollar, the kiwi edged up to 94.68 cents from 94.65, and to 73.92 yen from 73.86. It was at 59.72 euro cents from 59.73 but rose to 4.6109 Chinese yuan from 4.6012.

The New Zealand two-year swap rate fell to 1.8668 from 1.8848 per cent yesterday while the 10-year swap rate dropped to 2.5525 from 2.5800 per cent.