Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZ dollar pares gains from retail sales

NZ dollar pares gains from strong retail sales, Italian bond auction looms

By Paul McBeth

Nov. 14 (BusinessDesk) – The New Zealand pared gains from unexpectedly strong third-quarter retail sales as investors overcame their initial optimism ahead of the first Italian government bond auction under a new administration.

The kiwi dollar was little changed at 78.80 US cents at 5pm from 78.75 cents at 8am, and up from 78.53 cents in late trading on Friday. The currency spiked as high as 79.30 cents after the strong retail sales data.

The currency got a short-lived boost from today’s third-quarter retail sales figure, which showed the seasonally adjusted volume of consumer spending rose 2.2 percent in the three months ended Sept. 30, according to government data, beating expectations of a 0.7 percent quarterly gain.

The increase came off the back of the Rugby World Cup, which has struggled to register a pick-up in economic data, and the latest release has allayed fears the tournament wasn’t going to offer an injection to the economy.

Still, that comes ahead of an Italian government bond auction, with the new administration looking to sell as much as 3 billion euros of notes maturing in 2016. Former European Central Bank competition commissioner Mario Monti has been appointed as former Prime Minister Silvio Berlusconi’s replacement to prevent the spread of sovereign debt woes into the wider regional economy.

Retail sales “was a lot of World Cup spending on accommodation and food retail,” and isn’t showing a sustained lift in local demand, said Tim Kelleher, head of institutional FX sales New Zealand at ASB Institutional. The kiwi dollar is tracking Europe’s government bond markets and “we’re all becoming bond traders.”

Investor sentiment got a boost in late trading on Friday in New York, with stocks on Wall Street rallying ahead of the Italian government’s announcement.

Still, ASB’s Kelleher warned those gains were on very light trading, with the New York Stock Exchange reporting its fourth-thinnest trading day this year. That means those gains are vulnerable to a reversal, he said.

The kiwi dollar rose from 76.46 Australian cents from 76.38 cents on Friday and gained to 60.79 yen from 60.33. It rose to 57.21 Euro cents from 57.03 cents and gained to 49.01 British pence from 48.86 pence last week. The trade weighted index rose to 68.90 from 68.72 on Friday in New York.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Finance: Major Campaign To End "Gross Overtaxation Of Savings"

The campaign – which includes a special web site through which New Zealanders can e-mail their own and other MPs and party leaders – is backed by Age Concern, Consumer NZ, the Financial Services Council and the Taxpayers’ Union. More>>

ALSO:

Scoop Business: Leighton-Led WGP To Build, Manage Transmission Gully

The Wellington Gateway Partnership, led by a unit of ASX-listed Leighton Holdings, has won the $1 billion contract to build the Transmission Gully road north of Wellington. More>>

ALSO:

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news