Australian dollar weighed down by weak New Zealand inflation

THE Australian dollar is lower following disappointing inflation figures out of New Zealand.

Stack of Australian Dollars. Australian money. $100 bill stacks. Thinkstock

THE Australian dollar is lower following disappointing inflation figures out of New Zealand.

At 0700 AEDT on Friday, the local currency was trading at 87.55 US cents, down from 87.60 cents on Thursday.

The Australian dollar followed the kiwi lower on Thursday following the release of weaker-than-expected inflation figures. Statistics New Zealand data showed inflation was unchanged at 0.3 per cent in the September quarter, slowing the annual pace to one per cent, at the lower end of the Reserve Bank of New Zealand’s target band of between one and three per cent, and below analyst expectations for a 1.3 per cent rise.

The figures prompted many economists to push back their expectations for future rate hikes from the RBNZ.

“The overall story in currencies is one of the NZ dollar remaining friendless and the current G10 whipping boy in a generally stronger US dollar environment following yesterday’s very soft CPI report,” National Australia Bank global co-head of FX strategy Ray Attrill said.

The Australian dollar was also weighed down overnight by the release of better-than-expected economic data out of the US overnight.

Originally published as Australian dollar weighed down by weak New Zealand inflation