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

 


NZ dollar falls on benign inflation, RBA outlook

NZ dollar falls on benign inflation, RBA outlook

By Paul McBeth

Oct. 16 (BusinessDesk) - The New Zealand dollar fell in local trading as a more benign than expected inflation report and a weaker Australian economic outlook trimmed the appeal of the currency.

The kiwi fell as low as 81.40 US cents and traded at 81.57 cents at 5pm in Wellington, down from 81.82 cents at 8am and up from 81.43 cents yesterday. The trade-weighted index was unchanged at 72.80.

New Zealand's 90-day bank bill rate fell 5 basis points to 2.65 percent and the two-year swap rate declined 7 basis points to 2.47 percent after consumer prices rose at a slower than expected pace of 0.3 percent in the September quarter. That took annual inflation to 0.8 percent, below the Reserve Bank's target band of between 1 percent and 3 percent. The data comes before new central bank governor Graeme Wheeler delivers his first official cash rate review next week.

The OCR review "is a real focus regardless of what inflation is doing right now - there are a whole lot of questions about the new governor and whether the new policy target agreement is something we should read a lot into," said Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney.

Minutes from the Reserve Bank of Australia's Oct. 2 meeting show the board sees an "increased likelihood of growth over the coming year being somewhat weaker than earlier forecast." Australia has been dealing with a slowdown in its resources industry, a sector that helped it avoid recession during the global financial crisis. The kiwi fell to 79.46 Australian cents from 79.81 cents yesterday.

Tennent-Brown said the main focus for the trans-Tasman currencies this week will be the dump of Chinese data on Oct. 18, which is expected to show slowing economic growth in the world's most populous nation.

CBA expects the Australasian currencies will end the year higher with their respective economies in better shape than Europe, which is dealing with a sovereign debt crisis, and the US, which faces massive austerity if policymakers can't address the so-called 'fiscal cliff' after next month's Presidential election.

With trading volatility at the lowest level since before the 2008 global financial crisis, "the fundamentals of the Australian and New Zealand dollars will keep flowing through and the currencies will stay strong," he said.

The rose to 64.28 yen from 63.87 yen yesterday and slipped to 62.92 euro cents from 63.08 cents. It was little changed at 50.76 British pence from 50.74 pence yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Fossils: Ancient Penguins Lived Alongside Dinosaurs?

Penguins are much older than previously thought and their evolution probably dates back to the days of the dinosaurs, according to research on the fossilised leg bone and toes of a giant ancient penguin found in rocks near Waipara, North Canterbury. More>>

No Voda/Sky: Commission Declines Clearance For Merger

The Commerce Commission has declined to grant clearance for the proposed merger of Sky Network Television and Vodafone New Zealand. More>>

ALSO:

EARLIER:

Power: IEA Report On New Zealand's Energy System

Outside of its largely low-carbon power sector, managing the economy’s energy intensity and greenhouse gas emissions while still remaining competitive and growing remains a challenge. More>>

ALSO:

NASA: Seven Earth-Size Planets Around A Single Star

NASA's Spitzer Space Telescope has revealed the first known system of seven Earth-size planets around a single star. Three of these planets are firmly located in the habitable zone, the area around the parent star where a rocky planet is most likely to have liquid water. More>>

ALSO:

Auckland Transport Case: Men Guilty Of Corruption And Bribery Will Spend Time In Jail

Two men who were found guilty of corruption and bribery in a Serious Fraud Office (SFO) trial have been sentenced in the Auckland High Court today... The pair are guilty of corruption and bribery offences relating to more than $1 million of bribes which took place between 2005 and 2013 at Rodney District Council and Auckland Transport. More>>

ALSO:

Hager Raid: Westpac Wrong To Release Bank Records To Police

The Privacy Commissioner has censured Westpac Banking Corp for releasing without a court order more than 10 months of bank records belonging to the political activist and journalist Nicky Hager during a police investigation into leaked information published in Hager's 2014 pre-election book, 'Dirty Politics'. More>>

ALSO:

EARLIER:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news