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NZ Dollar Weakens After PM-elect Ardern Confirms RBNZ Reform

23:29, 23rd October 2017

(RTTNews) - The New Zealand dollar fell against its major counterparts in late Asian deals on Tuesday after New Zealand's Prime Minister elect Jacinda Ardern announced policy initiatives, aiming to review the Reserve Bank of New Zealand Act to include dual mandate of employment and inflation. Speaking after signing a coalition deal with the nationalist New Zealand First party, Jacinda Ardern said she plans to change the Reserve Bank Act to include employment goal, rather than inflation alone. Other policy priorities include banning foreign buyers from purchasing existing New Zealand homes and cut immigration by up to 30,000 people a year. Investors continued to monitor developments in Spain and the nomination of the next Federal Reserve chair for more direction. Meanwhile, at the end of its week-long once-in-a-five-year Congress, China's ruling Communist Party has voted to endorse a second five-year term for 64-year old President Xi Jinping.

The kiwi rose against its major rivals on Monday, with the exception of the yen.

The kiwi dropped to a 5-month low of 0.6926 against the greenback, off early 4-day high of 0.7004. The kiwi is seen finding support around the 0.68 region.

The kiwi hit a 1-1/2-month low of 78.57 against the yen and a 1-1/2-year low of 1.6970 against the euro, from its early high of 79.36 and a 5-day high of 1.6793, respectively. The next possible support for the kiwi is seen around 0.77 against the yen and 0.71 against the euro.

The kiwi slipped to 1-1/2-year low of 1.1274 against the aussie, after having advanced to a 5-day high of 1.1166 at 10:00 pm ET. On the downside, 1.14 is possibly seen as the next support for the kiwi.

Survey by the ANZ bank and Roy Morgan Research showed that Australia's consumer confidence rebounded during the week ended October 22.

The consumer confidence index rose to 113.3 from 112.4 in the preceding week.

Looking ahead, PMIs from major European economies are due in the European session.

In the New York session, Markit's preliminary U.S. manufacturing PMI for October is set for release.