NZ dollar falls as retail sales point to weak economy in third quarter
Nov. 14 (BusinessDesk) – The New Zealand dollar fell against most of its trading peers after figures showed a drop in third-quarter retail sales, adding to weak employment numbers in suggesting the economy hit a pothole in the period.
The kiwi dollar traded at 81.69 US cents from 81.88 cents at 8am in Wellington and from 81.66 cents in late trading the previous day. The trade-weighted index fell to 73.12 from 73.37 this morning.
Government figures today showed the volume of retail sales fell 0.4 percent, seasonally adjusted, in the three months ended Sept. 30, against a Reuters survey calling for a 0.5 percent gain. That adds to the gloom from data last week showing the jobless rate unexpectedly jumped to 7.3 percent, suggesting the economy’s pace is stumbling.
Retail sales were “more evidence that the third quarter of this year was a soft patch for the New Zealand economy,” said Imre Speizer, senior markets strategist at Westpac Banking Corp.
More up-to-date data, including business sentiment, suggests the economy sped up again in the fourth quarter, Speizer said.
The kiwi dollar fell to 78.15 Australian cents from 78.45 cents. It didn’t move much after Australia’s wage cost index for the third quarter rose 0.7 percent, close to market expectations of a 0.8 percent gain, for a year-on-year gain of 3.7 percent.
Speizer said the figures did show some evidence that wage inflation is starting to slow in the mining sector.
The New Zealand dollar fell to 64.95 yen from 65.09 yen and fell to 64.21 euro cents from 64.47 cents. It fell to 51.41 British pence from 51.62 pence.