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

 


NZ dollar jumps after Wheeler gives less-dovish MPS

NZ dollar jumps after Wheeler gives less-dovish MPS, interest-rate track little changed

Dec. 6 (BusinessDesk) - The New Zealand dollar rose after Reserve Bank governor Graeme Wheeler kept his forecast track for interest rates almost unchanged and gave no signal there’s room for the official cash rate to be cut.

The kiwi dollar rose to 82.81 US cents from 82.49 cents immediately before the monetary policy statement was released. The trade-weighted index rose to 73.84 from 73.68.

Wheeler kept the official cash rate unchanged at 2.5 percent, as expected. He called the strong kiwi dollar a “significant headwind” for the economy and said he would like to see it lower “if we could achieve it without threatening the inflation outlook and financial stability."

While intervention was an options “we have yet to find a situation that meets all of our traffic lights", he said. He trimmed his forecast for 90-day bank bills to 2.7 percent in the fourth quarter of 2013 from the 2.8 percent rate in the September MPS.

“The market was looking for something more dovish and maybe a greater opening for a rate cut,” said Robin Clements, senior economist at UBS New Zealand. “They’ve now concluded that’s not the case,” he said, adding that on first impression the MPS was “reasonably balanced.”

Still, Wheeler won’t rush to raise the OCR, forecasting a gradual rise in inflation to 2 percent, the mid-point of his target range. "The outlook we have is for the OCR to remain stable for quite some period. Our projections don't show an increase until next year, being 2014," he told a briefing after the MPS was released.

The kiwi dollar rose to 79.14 Australian cents from 78.86 cents before the report was released. Wheeler’s statement highlights the contrast with Australia, where the central bank cut its cash rate to 3 percent this week, citing a weak labour market.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Pest Control: Mouse Blitz Team Leaves For Antipodes

The Million Dollar Mouse project to rid Antipodes Island of mice is underway with the departure of a rodent eradication team to the remote nature reserve and World Heritage Area. More>>

Gongs Got: Canon Media Awards & NZ Radio Awards Happen

Radio NZ: RNZ website The Wireless, which is co-funded by NZ On Air, was named best website, while Toby Manhire and Toby Morris won the best opinion general writing section for their weekly column on rnz.co.nz and Tess McClure won the best junior feature writer section. More>>

ALSO:

Pre-Budget: Debt Focus Risks Losing Opportunity To Stoke Economy

The Treasury is likely to upgrade its forecasts for economic growth in Budget 2016 next week but Finance Minister Bill English has already signalled that more of his focus is on debt repayment than on fiscal stimulus or tax cuts... More>>

ALSO:

Fulton Hogan's Heroes: Managing Director Nick Miller Resigns

Fulton Hogan managing director Nick Miller will leave the privately owned construction company after seven years in charge. The Dunedin-based company has kicked off a search for a replacement, and Miller will stay on at the helm until March next year, or until a successor has been appointed and a transition period completed. More>>

ALSO:

Gordon Campbell: On Electricity, Executions, And Bob Dylan

The Electricity Authority has unveiled the final version of its pricing plan for electricity transmission. This will change the way transmission prices (which comprise about 10% of the average power bill) are computed, and will add hundreds of dollars a year to power bills for many ordinary consumers. More>>

ALSO:

Half Empty: Fonterra NZ, Australia Milk Collection Drops In Season

Fonterra Cooperative Group says milk collection is down in New Zealand and Australia, its two largest markets, in the first 11 months of the season during a period of weak dairy prices. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news