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

 


NZ dollar reaches 8-year high vs. Australian dollar

NZ dollar reaches 8-year high vs. Australian dollar after jobs figures disappoint

By Paul McBeth

Jan. 16 (BusinessDesk) - The New Zealand dollar climbed to a new eight-year high against its trans-Tasman counterpart after disappointing Australian jobs figures underlined the divergence between the neighbouring economies.

The kiwi rose as high as 94.52 Australian cents, trading at 94.45 cents at 5pm in Wellington from 93.40 cents yesterday. It was little changed at 83.29 US cents at 5pm from 83.32 cents at 8am and 83.36 cents yesterday.

The number of Australian jobs dropped by 22,600 in December, falling short of an expected gain of 10,000 in the month, and fuelled concerns about the country’s slowing economy. The Reserve Bank of Australia cut interest rates by 50 basis points to 2.5 percent last year in preparation for the looming peak of the nation’s resources boom, while at the same time New Zealand’s central bank laid the groundwork to start hiking rates this year.

“It was a big shock to the market and does keep alive the theme of kiwi outperforming the Aussie,” said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. “There’s no reason why the kiwi can’t keep going – 95 would be quite a stretch in the near-term.”

Still, Westpac’s Speizer said the kiwi could reach parity with the Australian dollar by the end of the year. It isn’t Westpac’s house view, but the cross-rate has historically overshot fair value by 10 percent, which leaves open the possibility, he said.

The Dollar Index, a measure of the greenback against a basket of currencies, held on to gains in the local trading session, trading at 80.98 at 5pm in Wellington after US manufacturing figures the Federal Reserve’s Beige Book painted a better picture of the world’s biggest economy.

Traders were spooked by a weak December employment reading last week, which spurred fears the Fed might not pull back on its stimulus programme as quickly as anticipated.

The local currency rose to 87.33 yen at 5pm in Wellington from 87 yen yesterday, and was little changed at 61.12 euro cents from 61.13 cents yesterday. It edged up to 50.85 British pence from 50.76 pence yesterday. The trade-weighted index climbed to 79.09 from 78.87 yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half Empty: Fonterra's 2017 Opening Forecast Below Expectations

Fonterra Cooperative Group raised its forecast farmgate milk payout for next season by less than expected as the world's largest dairy exporter predicts lower prices will crimp production and supply will pick up. The New Zealand dollar fell. More>>

ALSO:

Pest Control: Mouse Blitz Team Leaves For Antipodes

The Million Dollar Mouse project to rid Antipodes Island of mice is underway with the departure of a rodent eradication team to the remote nature reserve and World Heritage Area. More>>

Gongs Got: Canon Media Awards & NZ Radio Awards Happen

Radio NZ: RNZ website The Wireless, which is co-funded by NZ On Air, was named best website, while Toby Manhire and Toby Morris won the best opinion general writing section for their weekly column on rnz.co.nz and Tess McClure won the best junior feature writer section. More>>

ALSO:

Pre-Budget: Debt Focus Risks Losing Opportunity To Stoke Economy

The Treasury is likely to upgrade its forecasts for economic growth in Budget 2016 next week but Finance Minister Bill English has already signalled that more of his focus is on debt repayment than on fiscal stimulus or tax cuts... More>>

ALSO:

Fulton Hogan's Heroes: Managing Director Nick Miller Resigns

Fulton Hogan managing director Nick Miller will leave the privately owned construction company after seven years in charge. The Dunedin-based company has kicked off a search for a replacement, and Miller will stay on at the helm until March next year, or until a successor has been appointed and a transition period completed. More>>

ALSO:

Gordon Campbell: On Electricity, Executions, And Bob Dylan

The Electricity Authority has unveiled the final version of its pricing plan for electricity transmission. This will change the way transmission prices (which comprise about 10% of the average power bill) are computed, and will add hundreds of dollars a year to power bills for many ordinary consumers. More>>

ALSO:

Half Empty: Fonterra NZ, Australia Milk Collection Drops In Season

Fonterra Cooperative Group says milk collection is down in New Zealand and Australia, its two largest markets, in the first 11 months of the season during a period of weak dairy prices. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news