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

 


NZ dollar falls on December inflation outlook, quake flurry

NZ dollar falls on December inflation outlook, quake flurry

By Paul McBeth

Jan. 20 (BusinessDesk) - The New Zealand dollar fell ahead of tomorrow’s December inflation figures which are seen as feeding into the Reserve Bank’s interest rate outlook, and after an earthquake in the lower North Island caused a brief flurry of selling.

The kiwi traded at 82.43 US cents at 5pm in Wellington from 82.46 cents at 8am, down from 82.62 cents on Friday in New York. The trade-weighted index declined to 78.37 from 78.61 last week.

New Zealand’s consumers price index is forecast to have fallen 0.1 percent in the final three months of 2013, for an annual rate of 1.5 percent, according to a Reuters survey. The RBNZ plans to hike interest rates this year to head off the threat of inflation, and investors will be watching the CPI to gauge when governor Graeme Wheeler might start tightening policy. Traders are betting the 2.5 percent official cash rate will rise 109 basis points over the coming 12 months, according to the Overnight Index Swap curve.

“CPI looms large – we know it’s a key figure, especially with all the talk being about interest rates at the moment,” said Alex Hill, head of dealing at HiFX in Auckland. “It might impact on the tone from Wheeler at the end of the month.”

Today’s 6.3 magnitude earthquake in the Lower North Island sparked a brief drop in the local currency, which it has since recovered, though Hill said the strength of the US dollar will keep the kiwi under pressure.

Real Estate Institute figures today showed New Zealand’s housing market continued to slow in December, with fewer sales and a decline in the median sale price in Auckland, which has been a key driver over the past year.

A BusinessDesk survey of six traders and strategists predicts the local currency will trade between 81.20 US cents and 84.20 cents this week. Four predict the kiwi will fall this week, while one expects it to gain and one sees it largely unchanged.

The kiwi fell to 85.72 yen at 5pm in Wellington from 86.20 yen last week, and declined to 93.87 Australian cents from 94.12 cents. It slipped to 60.93 euro cents from 61.04 cents on Friday in New York, and edged down to 50.22 British pence from 50.34 pence.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Half A Billion Accounts: Yahoo Confirms Huge Data Breach

The account information may have included names, email addresses, telephone numbers, dates of birth, hashed passwords (the vast majority with bcrypt) and, in some cases, encrypted or unencrypted security questions and answers. More>>

Rural Branches: Westpac To Close 19 Branches, ANZ Looks At 7

Westpac confirms it will close nineteen branches across the country; ANZ closes its Ngaruawahia branch and is consulting on plans to close six more branches; The bank workers union says many of its members are nervous about their futures and asking ... More>>

Interest Rates: RBNZ's Wheeler Keeps OCR At 2%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2 percent and said more easing will be needed to get inflation back within the target band. More>>

ALSO:

Half Full: Fonterra Raises Forecast Payout As Global Supply Shrinks

Fonterra Cooperative Group, the dairy processor which will announce annual earnings tomorrow, hiked its forecast payout to farmers by 50 cents per kilogram of milk solids as global supply continues to decline, helping prop up dairy prices. More>>

ALSO:

Results:

Meat Trade: Silver Fern Farms Gets Green Light For Shanghai Maling Deal

The government has given the green light for China's Shanghai Maling Aquarius to acquire half of Silver Fern Farms, New Zealand's biggest meat company, with ministers satisfied it will deliver "substantial and identifiable benefit". More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news