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

 


NZ dollar extends decline as Fed minutes hint at end to QE

NZ dollar extends decline as Fed minutes hint at quantitative easing exit; US jobs data looms

By Paul McBeth

Jan. 4 (BusinessDesk) - The New Zealand dollar extended its decline in local trading as investors rethought their expectations for American interest rates after minutes from the Federal Reserve's last monetary policy review showed some members want to stop printing money as early as this year.

The kiwi fell to 82.32 US cents at 5pm in Wellington from 82.89 cents at 8am and 83.21 cents yesterday. The trade-weighted index declined to 74.32 from 74.75 yesterday.

Investors sold off equities around the globe after the Federal Open Market Committee minutes showed some officials "thought that it would probably be appropriate to slow or to stop purchases well before the end of 2013." The kiwi dollar was one of the best performing currencies last year as efforts by central banks to prop up ailing economies through printing new money flooded markets and prompted investors to seek out countries that offering positive real interest rates.

The idea that US interest rates would stay lower for longer "was pretty well priced in, and it's starting to get questioned," said Mike Jones, currency strategist at Bank of New Zealand in Wellington. "There's probably a bit more downside for the kiwi, Aussie and euro."

Jones said the currency will probably find buyers all the way down to 80 US cents as exporters look for cheaper entries for their hedging programmes.

The publication of the Fed's acknowledgment that it can't keep printing money forever comes ahead US non-farm payrolls figures, which are expected to show the unemployment rate stayed at a four-year low 7.7 percent, according to a Bloomberg survey of economists.

The US central bank is putting more emphasis on the labour market, saying it will keep the benchmark interest rate near zero until the jobless rate comes below 6.5 percent and two-year-ahead inflation projections stay below 2.5 percent.

The New Zealand dollar fell to 72.24 yen from 72.58 yen yesterday and declined to 78.90 Australian cents from 79.36 cents. It decreased to 63.19 euro cents from 63.33 cents, and was little changed at 51.23 British pence from 51.28 pence yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Drones: First Certificate Issued Under New UAV Rules

Transport Minister Simon Bridges and Associate Transport Minister Craig Foss say the first certified flight of an unmanned helicopter under new aviation rules is a great example of how they can enable commercial use. More>>

ALSO:

GE Swedes And Cow Deaths: Plant Analysis Backs Up Earlier Advice

The industry body is recommending that farmers do not feed Herbicide Tolerant (HT) swedes to cows in spring when the animals are in late pregnancy or early lactation. DairyNZ is also advising caution if farmers are considering other leafy varieties. More>>

ALSO:

Statistics: Dairy And Travel Still Our Largest Export Earners

New Zealand earned $2.3 billion more from exports than we spent on imports during the year ended June 2015... total exports of goods and services were $67.5 billion, while total imports were $65.1 billion. More>>

ALSO:

Approval: Air New Zealand And Air China Launch New Alliance Route

Air New Zealand and Air China have today launched joint sales for a new daily direct service between Auckland and Beijing after receiving approval from New Zealand Minister of Transport Hon Simon Bridges to form a strategic alliance. More>>

ALSO:

Money Trading: FX Trader Jin Yuan Finance Warned Over Lack Of Monitoring

Jin Yuan Finance, an Auckland-based foreign exchange trader, has been warned over its lack of anti-money laundering processes in place in the first public notification by the Department of Internal Affairs. More>>

ALSO:

Auckland Surge, Possible Peak: House Values Accelerate At Fastest Annual Pace In 8 Years

New Zealand residential property values rose at their fastest annual pace in eight years in August, pushed higher by overflowing demand in Auckland, which is showing signs speculators think it has reached its peak, according to Quotable Value. More>>

ALSO:

Cash Money: Reserve Bank Launches New $5 And $10 Banknotes

The $5 and $10 final banknotes were revealed at an event at the Bank in Wellington, and will start to be released from mid-October 2015. More>>

ALSO:

Truck Sales Booted: Commerce Commission Files Charges Against Mobile Trader

The Commerce Commission has filed charges against a mobile trader, or truck shop operator, claiming he obtained money from customers by deception and never intended to supply them with the goods they paid for. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news