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

 


Kiwi treads water in holiday trade ahead of OCR review

Kiwi treads water in holiday trade ahead of OCR review

Jan. 28 (BusinessDesk) – The New Zealand dollar was mixed in a holiday-affected session on Monday ahead of the official cash rate review on Thursday.

Both the kiwi and aussie dollars were weak against a resurgent euro.

The euro hit an 11-month high versus the dollar on Friday after the European Central Bank said banks would pay back a greater-than-expected 137 billion euros in loans next week, a sign of strength in the financial system, Reuters reported.

The kiwi was at 62.16 euro cents at 5pm, barely changed from 62.15 at 8am and 62.60 on Friday.

“European banks are repaying money because they don’t need it. They can get it cheaper elsewhere,” one dealer said.

The kiwi traded in a narrow range before settling at 83.59US cents at 5pm from 83.50 cents at 8am and 83.63 cents at 5pm on Friday.

While tensions are easing in Europe, the BNZ says they are stirring in New Zealand with respect to monetary policy.

“We expect Reserve Bank of New Zealand governor, Graeme Wheeler, to play things down the middle at Thursday’s official cash review, keeping the official cash rate at 2.50 percent and his rhetoric appropriately vague and open-ended.

“But, make no mistake, tensions are brewing,” BNZ strategists said.

There are lots to reasons to keep interest rates down as well as emerging trends that suggest they should rise.

“We suspect he will not want to shift market pricing to any material degree. As much as he’s not the dove Bollard was, nor does that make him an outright hawk. It’s all relative,” BNZ said.

They said the market may also learn more about Wheeler’s leanings when he delivers an on-the-record speech to the Canterbury Employers’ Chamber of Commerce on Friday.

“This customary new year address tends to deal with big-picture issues and trends.”

A fall in the performance of services index to 51.5 in December from 54.2 in November revealed today did not alter the broad outlook for economic growth.

Foreign exchange dealers are also monitoring the discovery of traces of Dicyandiamide, or DCD, in New Zealand milk products and say the next Fonterra milk powder auction will be interesting next Tuesday, Feb 5.

“While it is clearly something for the involved companies and government agencies to manage from a public relations perspective, our understanding is that it is not any genuine food safety concern,” BNZ said.

The kiwi was at 76.13 yen at 5pm from 75.67 yen at 5pm on Friday.

It was at 80.22 Australian cents from 80.08 cents on Friday and was at 53.06 British pence from 53.02 pence.

The trade-weighted index was at 75.34 from 75.42.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Starts Talks On Tougher Rules For Property Speculators

The Reserve Bank of New Zealand is stepping up preparations to restrict lending to residential property investors as it watches house prices, particularly in Auckland, continue to rise strongly. More>>

ALSO:

Research: ‘Ageing Well’ Science Challenge Launched

Science and Innovation Minister Steven Joyce today launched the Ageing Well National Science Challenge, confirming initial funding of $14.6 million. More>>

ALSO:

Scoop Business: Govt Resisting Pressure To Pump More Cash Into Solid Energy

Prime Minister John Key says it is “not the government’s preferred option” to make a fresh capital injection into the troubled state-owned coal miner, Solid Energy, but dodged journalists’ questions at his weekly press conference on whether that might prove necessary... More>>

ALSO:

Lagest Ever Privacy Breach Award: NZCU Baywide Accepts “Severe” Censure In Cake Case

NZCU Baywide says that once it was found to have committed a breach of a former staff member’s privacy, it had attempted to resolve the matter... the censure and remedies for its actions taken almost three years ago are “severe” but accepted, and will hopefully draw a line under the matter. More>>

ALSO:

Scoop Business: PayPal Stops Processing Mega Payments; NZX Listing Still On

PayPal has ceased processing payments for Mega, the file storage and encryption firm looking to join the New Zealand stock market via a reverse listing of TRS Investments, amid claims it is not a legitimate cloud storage service. More>>

ALSO:

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

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