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NZD stuck to the bottom of the G10 pile on.....>

KIWI: NZD stuck to the bottom of the G10 pile on Thursday after the RBNZ pushed
out expectations for a rate hike. The move triggered NZD weakness across the
board, with NZD/USD printing multi-year lows of $0.6612. AUD/NZD spiked through
NZ$1.1100 to highs of NZ$1.1175.
- NZD/USD has continued to ease in early dealing, flirting with $0.6600 last. -
The moderation in the NZ manufacturing PMI generated more of a reaction than
usual in early dealing, likely owing to the RBNZ's lower growth
profile/highlighting the risks around growth. Elsewhere it is worth noting that
Fonterra "reduced last season's 2017/18 forecast Farmgate Milk Price to $6.70
(prev. $6.75). The prev. $0.25-30 guidance range has been held but it will be at
or slightly below this range & it is likely that the full year dividend will be
just the $0.10 already paid in April." There was no change to Fonterra's
forecast of the milk price for the current season of $7/kgMs. This comes after
Fonterra's stock was halted on Thursday. REINZ House price data will headline
the NZ docket next week, with Q2 PPI also due. Traders will look to the AUD/NZD
cross and NZ IR markets, as well as the broader USD themes for direction.
MNI London Bureau | +44 0203-865-3809 |
MNI London Bureau | +44 0203-865-3809 |

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