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

 


NZ dollar climbs near 18-month high vs. Aussie

NZ dollar climbs near 18-month high vs. Aussie as trans-Tasman fortunes turn

By Paul McBeth

Feb. 1 (BusinessDesk) - The New Zealand dollar climbed near an 18-month high against its Australian counterpart as the fortunes for the neighbours pall, while looking rosier on this side of the Tasman.

The kiwi climbed as high as 80.93 Australian cents, the highest since August 2011, and traded at 80.81 cents at 5pm in Wellington from 80.31 cents yesterday. The currency was unchanged at 84.10 cents from 8am and up from 83.67 cents yesterday.

New Zealand is becoming a more attractive destination for investors looking for higher yields, with the Reserve Bank looking more likely to hike or maintain rates at current levels, while its Australian counterpart has an easing bias. That comes as the local economy is set to get a boost from the looming Canterbury rebuild, while Australia's mining boom continues to come off its peak. The yield on New Zealand's 10-year government bonds is almost 26 basis points higher than its Australian equivalent at 3.77 percent.

"I really do think the Christchurch rebuild will lead to a rise in rates quicker than other people do," said Tim Kelleher, head of institutional FX sales NZ at ASB Institutional in Auckland. The kiwi/Australian cross is "undervalued" he said. "I see it heading up towards 85 (Australian) cents," though that's not ASB's official view, he said.

The Australian dollar also took a hit from slightly weaker Chinese manufacturing figures than expected, with the nation's economy more closely linked than New Zealand to China's fortunes. The Australian dollar fell to US$1.0401 at 5pm in Wellington from US$1.0442 before the announcement.

The kiwi's rally comes after the Reserve Bank held the official cash rate at 2.5 percent yesterday, and a speech by governor Graeme Wheeler today, which again played down the bank's ability to influence the currency in a low interest rate environment.

Figures published this week showed the Reserve Bank sold a net $199 million of kiwi dollars in December, which has been seen as the RBNZ taking a punt on the currency running out of steam.

Investors largely ignored flat migration numbers for December, which showed a slowing pace of annual net migration out of New Zealand, and will be looking at US employment figures out on Friday in Washington.

The kiwi dollar climbed to 77.21 yen at 5pm in Wellington from 75.87 yen yesterday, and increased to 61.78 euro cents from 61.50 cents. It rose to 53.01 British Pence from 52.80 pence yesterday.

The trade-weighted index advanced to 75.64 from 75.06 yesterday. The TWI rose as high as 75.82, and is trading near the 77.17 peak in mid-2007, when the Reserve Bank last intervened.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Scoop Business: Productivity Commission To Look At Housing Land Supply

The Productivity Commission is to expand on its housing affordability report with an investigation into improving land supply and development capacity, particularly in areas with strong population growth. More>>

ALSO:

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:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

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