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

 


NZ dollar gains as investors reassured on Chinese liquidity

NZ dollar gains as investors reassured about Chinese liquidity, growth

By Tina Morrison

June 26 (BusinessDesk) – The New Zealand dollar gained as investors were reassured China’s central bank would help ease a credit crunch that sparked concerns about growth in the world’s second-largest economy.

The kiwi edged up to 77.30 US cents from 77.16 cents at 5pm in Wellington yesterday. In the past 12 hours, the local currency has traded as low as 76.95 cents and as high as 77.95 cents. The trade-weighted index inched up to 72.91 from 72.79 yesterday.

The New Zealand dollar dropped yesterday as Asian stock markets fell and traders dumped risk-sensitive currencies on concern a tightening of banking liquidity by the People’s Bank of China would sap growth in the world’s second biggest economy. The kiwi then rebounded after China’s central bank said it had provided liquidity to some financial institutions to stabilise money-market rates, the first official signs of relief to ease a credit crunch.

“The Chinese stock market plunged 6 percent during our late afternoon then in the last hour of trading it completely reversed and closed slightly up for the day,” said Imre Speizer, senior currency strategist at Westpac Banking Corp. “The initial scare completely subsided, that helped things rebound a bit and then everything just went sideways. For the day, it can correct a bit higher.”

China is the world’s most-populous country and New Zealand’s second-largest export market.

New Zealand’s dollar has been on a downward path against the greenback since Federal Reserve chairman Ben Bernanke said last week the central bank may start winding back its US$85 billion a month asset purchase programme this year if economic data continues to improve.

In the US yesterday, economic figures provided evidence of further strength, as reports on durable goods orders, sales of new homes, home prices and consumer confidence all beat analysts’ expectations.

The Conference Board’s index of consumer confidence rose to 81.4 in June from 74.3 in May. Durable goods orders gained 3.6 percent last month, while sales of new homes increased more than forecast in May, climbing to the highest level in almost five years, and home prices rose more than forecast in the 12 months through April.

The New Zealand dollar may continue its decline, said Westpac’s Speizer. “It’s just a short-term correction and it shouldn’t last more than a few days,” he said.

The kiwi was little changed against the Australian dollar, recently trading at 83.44 Australian cents, from 83.47 cents yesterday. The local currency edged up to 75.58 yen from 75.23 yen, it rose to 59.05 euro cents from 58.83 cents and gained to 50.09 British pence from 49.98 pence.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Sky City : Auckland Convention Centre Cost Jumps By A Fifth

SkyCity Entertainment Group, the casino and hotel operator, is in talks with the government on how to fund the increased cost of as much as $130 million to build an international convention centre in downtown Auckland, with further gambling concessions ruled out. The Auckland-based company has increased its estimate to build the centre to between $470 million and $530 million as the construction boom across the country drives up building costs and design changes add to the bill.
More>>

ALSO:

RMTU: Mediation Between Lyttelton Port And Union Fails

The Rail and Maritime Union (RMTU) has opted to continue its overtime ban indefinitely after mediation with the Lyttelton Port of Christchurch (LPC) failed to progress collective bargaining. More>>

Earlier:

Science Policy: Callaghan, NSC Funding Knocked In Submissions

Callaghan Innovation, which was last year allocated a budget of $566 million over four years to dish out research and development grants, and the National Science Challenges attracted criticism in submissions on the government’s draft national statement of science investment, with science funding largely seen as too fragmented. More>>

ALSO:

Scoop Business: Spark, Voda And Telstra To Lay New Trans-Tasman Cable

Spark New Zealand and Vodafone, New Zealand’s two dominant telecommunications providers, in partnership with Australian provider Telstra, will spend US$70 million building a trans-Tasman submarine cable to bolster broadband traffic between the neighbouring countries and the rest of the world. More>>

ALSO:

More:

Statistics: Current Account Deficit Widens

New Zealand's annual current account deficit was $6.1 billion (2.6 percent of GDP) for the year ended September 2014. This compares with a deficit of $5.8 billion (2.5 percent of GDP) for the year ended June 2014. More>>

ALSO:

Still In The Red: NZ Govt Shunts Out Surplus To 2016

The New Zealand government has pushed out its targeted return to surplus for a year as falling dairy prices and a low inflation environment has kept a lid on its rising tax take, but is still dangling a possible tax cut in 2017, the next election year and promising to try and achieve the surplus pledge on which it campaigned for election in September. More>>

ALSO:

Job Insecurity: Time For Jobs That Count In The Meat Industry

“Meat Workers face it all”, says Graham Cooke, Meat Workers Union National Secretary. “Seasonal work, dangerous jobs, casual and zero hours contracts, and increasing pressure on workers to join non-union individual agreements. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

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