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

 

Economic Update: RBNZ Says Rate Cut Seems Likely

The Reserve Bank will likely cut interest rates further as a persistently strong kiwi dollar makes it difficult for the bank to meet its inflation target, it said. The local currency fell. More>>

ALSO:

House Price Action Plan: RBNZ Signals National Lending Restrictions

The central bank wants to cap bank lending to property investors with a deposit of less than 40 percent at 5 percent and restore the 10 percent limit for owner-occupiers wanting to take out a mortgage with a deposit of less than 20 percent, according to a consultation paper released today. More>>

ALSO:

Sparks Fly: Gordon Campbell On China Steel Dumping Allegations

No doubt, officials on the China desk at MFAT have prided themselves on fashioning a niche position for New Zealand right in between the US and China – and leveraging off both of them! Well, as the Aussies would say, of MFAT: tell ‘em they’re dreaming. More>>

ALSO:

Loan Sharks: Finance Companies Found Guilty Of Breaching Fair Trading Act

Finance companies Budget Loans and Evolution Finance, run by former 1980s corporate high-flyer Allan Hawkins, have been found guilty of 106 charges of breaching the Fair Trading Act for misleading 21 borrowers while enforcing loan contracts. More>>

ALSO:

Post Panama Papers: Govt To Adopt Shewan's Foreign Trust Recommendations

The government will adopt all of the recommendations from former PwC chairman John Shewan to increase disclosure and introduce a register for foreign trusts with new legislation to be introduced next month. More>>

ALSO:

The Price Of Cheese: Cheddar At Eight-Year Low

Food prices decreased 0.5 percent in the year to June 2016, influenced by lower grocery food prices (down 2.3 percent), Statistics New Zealand said today. Compared with June 2015, cheese prices were down 9.5 percent, fresh milk was down 3.9 percent, and yoghurt was down 9.2 percent. More>>

ALSO:

Financial Advisers: New 'Customer-First' Obligations

Goldsmith plans to do away with the current adviser designations which he says have been "unsatisfactory" in that some advisers are obliged to disclose potential conflicts of interest and act in their customers' best interests, but others are not. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news