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

 


NZ dollar gains vs. Oz dollar as business investment slows

NZ dollar gains vs. Australian dollar as business investment slows across the Tasman

By Paul McBeth

Nov. 29 (BusinessDesk) - The New Zealand dollar gained against its Australian counterpart after official figures showed business investment is slowing in Australia, which could be a key factor in its central bank interest rate decision next week.

The kiwi rose to 78.75 Australian cents from 78.56 cents yesterday. It traded at 82.41 US cents at 5pm in Wellington from 82.34 cents at 8.30am, and up from 82.14 cents yesterday.

Australian capital spending advanced 2.8 percent from the second quarter, when it rose 3.4 percent, the Bureau of Statistics said in Sydney today. Still, signs of a slowing Australian resources boom have investors nervous the Reserve Bank of Australia will cut interest rates next week.

Traders are pricing a 68 percent chance the 3.25 percent target cash rate will be trimmed, according to the Overnight Index Swap curve. New Zealand's central bank, which also meets next week, is being given a 14 percent chance of a cut to its 2.5 percent official cash rate, meaning Australia's yield advantage will probably narrow.

"The Aussie capex data was a bit mixed, but doesn't seem to have done anything to upset things," said Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney. "The kiwi was lifting through the morning (against the Australian dollar), and since then (the capex data) it has outperformed."

Risk-sensitive currencies got a lift from upbeat comments by US House of Representatives Speaker John Boehner, who said he was optimistic policymakers could "avert this crisis sooner rather than later," referring to the US$607 billion of automatic tax increases and spending cuts pencilled in for Jan. 1.

The kiwi dollar might also have got a fillip from investors in the Fonterra Cooperative Group's shareholder fund float. About 42 percent of the $525 million initial public offer went to international investors who will have to settle their accounts after getting their allocation yesterday. The units are set to begin trading tomorrow.

The trade-weighted index advanced to 73.74 from 73.46. The currency rose to 67.65 yen from 67.22 yen yesterday, and increased to 51.45 British pence from 51.30 pence. It advanced to 63.63 euro cents from 63.50 cents yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

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:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

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