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

 

NZ dollar rallies as Chinese trade surplus grows

NZ dollar rallies as Chinese trade surplus grows, stoking confidence in economy

By Paul McBeth

Jan. 10 (BusinessDesk) - The New Zealand gained as a stronger-than-expected Chinese trade surplus stoked investors' confidence the world's second-biggest economy has weathered a slowdown and can regain momentum.

The kiwi gained to 84 US cents at 5pm in Wellington from 83.82 cents at 9am and 83.81 cents yesterday. The trade-weighted index climbed to 75.66 from 75.44.

China's trade surplus almost doubled to US$31.6 billion in December from the same month a year earlier on a 14 percent jump in exports and a 6 percent increase in imports. China is Australia's biggest trading partner and New Zealand's second-biggest behind its closest neighbour, meaning its economic fortunes weigh heavily on the trans-Tasman currencies.

New Zealand government figures today showed a slightly wider-than-expected local trade deficit of $700 million in November, while QV data showed property values rose 5.7 percent last year and ANZ figures showed an increase in commodity prices last month.

"The kiwi data continues to be positive and China's recovery is starting to show evidence and today's trade data added to that," said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. "The kiwi will continue to outperform - look at economic fundamentals and they're pretty good, the outlook is pretty good and interest rates will eventually turn positive."

Speizer said he expects the currency to temporarily shed some gains against the greenback for a few days before rising to test the 84.75 US cents high it reached last year.

The kiwi fell to 79.61 Australian cents at 5pm from 79.85 cents yesterday after the Chinese trade data, with the bigger nation having greater export exposure to the world's most populous country. Official figures also showed Australian home building permits rose 2.9 percent in November as lower interest rates encouraged plans for apartment projects.

The New Zealand dollar climbed as high 74.08 yen, the highest level since September 2008, and traded at 73.93 yen at 5pm from 73.28 yen yesterday. Japan's currency weakened after Prime Minister Shinzo Abe urged the central bank to double its inflation target to 2 percent. Bank of Japan governor Masaaki Shirakawa yesterday said he's working closely with the government ahead of the bank's next meeting on Jan. 21 to 22.

The kiwi gained to 64.34 euro cents from 64.08 cents yesterday ahead of the European Central Bank's monetary policy review, and increased to 52.42 British pence from 52.22 pence before the Bank of England reviews its benchmark interest rate and quantitative easing programme.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Superu Report: Land Regulation Drives Auckland House Prices

Land use regulation is responsible for up to 56 per cent of the cost of an average house in Auckland according to a new research report quantifying the impact of land use regulations, Finance Minister Steven Joyce says. More>>

ALSO:

Fletcher Whittled: Fletcher Dumps Adamson In Face Of Dissatisfaction

Fletcher Building has taken the unusual step of dumping its chief executive, Mark Adamson, as the company slashed its full-year earnings guidance and flagged an impairment against Australian assets. More>>

ALSO:

No More Dog Docking: New Animal Welfare Regulations Progressed

“These 46 regulations include stock transport, farm husbandry, companion and working animals, pigs, layer hens and the way animals are accounted for in research, testing and teaching.” More>>

ALSO:

Employment: Most Kiwifruit Contractors Breaking Law

A Labour Inspectorate operation targeting the kiwifruit industry in Bay of Plenty has found the majority of labour hire contractors are breaching their obligations as employers. More>>

ALSO:

'Work Experience': Welfare Group Opposes The Warehouse Workfare

“This programme is about exploiting unemployed youth, not teaching them skills. The government are subsidising the Warehouse in the name of reducing benefit dependency,” says Vanessa Cole, spokesperson for Auckland Action Against Poverty. More>>

ALSO:

Internet Taxes: Labour To Target $600M In Unpaid Taxes From Multinationals

The Labour Party would target multinationals operating in New Zealand to ensure they don't avoid paying tax if it wins power and is targeting $600 million over three years through a "diverted profits tax," says leader Andrew Little. More>>

ALSO: