NZ dollar rises as Asian stocks gain amid hopes for China

NZ dollar rises as Asian stocks gain amid hopes for Chinese stimulus

By Hannah Lynch

Oct. 9 (BusinessDesk) - The New Zealand dollar followed Asian equity markets higher amid hopes China's government will boost stimulus policies to stop the slowdown in the economy.

The New Zealand dollar rose to 82.27 US cents from 82.02 cents at 8am and 81.77 cents yesterday. The kiwi increased to 64.46 yen from 64.21 yen yesterday and the trade weighted index climbed to 73.38 from 73.06.

China's Shanghai Composite Index has fallen about 4 percent this year on concern the world's second-biggest economy isn’t acting fast enough to soften the country's economic slowdown.
Stocks rallied across the region as investors bet China will step up efforts to prevent a hard-landing. The Shanghai Composite Index rose 2 percent, Hong Kong's Hang Seng Index climbed 1.1 percent and Australia's S&P/ASX 200 index increased 0.7 percent.

"Today's it's been the Asian markets opening with a positive tone that's given the New Zealand dollar a boost," said Dan Bell, currency strategist at HiFX. "There's not a lot of good news out there - it’s a bit of positioning helping lift the kiwi."

The local currency was little changed after the New Zealand Institute of Economic Research said economic growth is set to slow in the second half of the year as local businesses got gloomier in the third quarter in a deteriorating trading environment. It predicts the pace of annual growth will slow to 1.5 percent in the second half of the year from 2.6 percent at the end of June.

New Zealand's credit and debit card spending fell 0.6 percent in September, snapping August's gains after kiwis' cut down how much they spent on consumable items such as food and liquor. Economists were predicting a decline of 0.3 percent.

There is no significant New Zealand set for release on Wednesday. The accommodation survey for August will be released on Thursday as well as the food price index for September from Statistics New Zealand. That's followed by the ANZ-Roy Morgan Consumer Confidence and Bank of New Zealand performance of manufacturing index set for release on Thursday afternoon.

The New Zealand dollar was little changed at 80.34 Australian cents from 80.47 cents yesterday. The kiwi rose to 51.28 British pence from 50.74 pence, and gained to 63.35 euro cents from 62.94 cents.

(BusinessDesk)

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