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

 


NZ dollar hits 9-mth high on TWI on Wheeler inflation view

NZ dollar hits 9-month high on TWI basis after Wheeler warns on housing inflation

By Paul McBeth

Dec. 6 (BusinessDesk) - The New Zealand dollar rose to a nine-month high on a trade-weighted basis after Reserve Bank governor Graeme Wheeler kept the benchmark interest rate unchanged and warned about the threat of inflation in the housing market.

The trade-weighted index rose as high as 74.15, the highest since Feb. 20, and traded at 74.03 at 5pm in Wellington from 73.52 yesterday. The kiwi advanced to 82.87 US cents at 5pm from 82.55 cents at 8am and 82.48 cents yesterday.

RBNZ's Wheeler kept the official cash rate at 2.5 percent as expected, and said on the current projections it isn't going to move until the end of 2013. The bank warned on Auckland's property market which is heating up, and sharpened the new governor's focus on inflation. The Reserve Bank is forecasting annual inflation to stay near the bottom of the band in the next year, rising to 2 percent in the March 2015 quarter as building activity ramps up and as the currency starts running out of steam.

"This really confirms he is an inflation hawk - it's mostly about inflation," said Imre Speizer, market strategist at Westpac Banking in Auckland. "I'm bullish on the kiwi for the next few days."

Speizer said the currency may break above 83.10 US cents and test 83.55 cents in Northern Hemisphere trading.

The central bank has been under increasing pressure to cut the benchmark rate in a bid to stoke economic growth and bring down the kiwi dollar, and has had to weigh that up against an Auckland property market that’s heating up.

Wheeler said the kiwi is a “significant headwind, restricting export earnings and encouraging demand for imports.” The bank has changed its view on its projections for the currency, and sees it holding above 73 on a trade-weighted basis until December 2013, and falling to 71.40 in early 2015.

The kiwi rose to 79.19 Australian cents from 78.71 cents yesterday after government figures showed unemployment across the Tasman unexpectedly fell to 5.2 percent.

New Zealand's currency rose to 68.38 yen from 67.80 yen yesterday and advanced to 63.50 euro cents from 62.90 cents. It gained to 51.52 British pence from 51.19 pence yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Forestry: Man Charged After 2013 Death

Levin Police have arrested and charged a man with manslaughter in relation to the death of Lincoln Kidd who was killed during a tree felling operation on 19 December 2013. More>>

ALSO:

Smells Like Justice: Dairy Company Fined Over Odour

Dairy company fined over odour Dairy supply company Open Country Dairy Limited has been convicted and fined more than $35,000 for discharging objectionable odour from its Waharoa factory at the time of last year’s ”spring flush” when milk supply was high. More>>

Scoop Business: Dairy Product Prices Decline To Lowest Since July 2012

Dairy product prices dropped to the lowest level since July 2012 in the latest GlobalDairyTrade auction, led by a slump in rennet casein and butter milk powder. More>>

ALSO:

SOE Results: TVNZ Lifts Annual Profit 25% On Flat Ad Revenue, Quits Igloo

Television New Zealand, the state-owned broadcaster, lifted annual profit 25 percent, ahead of forecast and despite a dip in advertising revenue, while quitting its stake in the pay-TV Igloo joint venture with Sky Network Television. More>>

ALSO:

Insurers Up For More Payouts: Chch Property Investor Wins Policy Appeal In Supreme Court

Ridgecrest NZ, a property investor, has won an appeal in the Supreme Court over insurance cover provided by IAG New Zealand for a Christchurch building damaged in four successive earthquakes. More>>

ALSO:

Other Cases:

Royal Society: Review Finds Community Water Fluoridation Safe And Effective

A review of the scientific evidence for and against the efficacy and safety of fluoridation of public water supplies has found that the levels of fluoridation used in New Zealand create no health risks and provide protection against tooth decay. More>>

ALSO:

Scoop Business: Croxley Calls Time On NZ Production In Face Of Cheap Imports

Croxley Stationery, whose stationery brands include Olympic, Warwick and Collins, plans to cease manufacturing in New Zealand because it has struggled to compete with lower-cost imports in a market where the printed word is giving way to electronic communications. More>>

ALSO:

Prefu Roundup: Forecasts Revised, Surplus Intact

The National government heads into the election with its Budget surplus target broadly intact, delivering a set of economic and fiscal forecasts marginally revised from May to reflect weaker commodity prices and a lower tax take. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

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