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

 

Scoop Business:
NZ Puts Seven New Oil And Gas Areas Put Up For Tender

A total of seven new areas will be opened up to oil and gas exploration under its block offer tendering system, as the New Zealand government seeks to concentrate activity in a few strategically chosen areas. More>>

ALSO:

Half Full: Dairy Payouts Steady, Cash Will Be Tight

Industry body DairyNZ is advising farmers to focus on strong cashflow management as they look ahead to the 2015-16 season following Fonterra's half-year results announcement today. More>>

ALSO:

First Union: Cotton On Plans To Use “Tea Break” Law

“The Prime Minister reassured New Zealanders that ‘post the passing of this law, will you all of a sudden find thousands of workers who are denied having a tea break? The answer is absolutely not’... Cotton On is proposing to remove tea and meal breaks for workers in its safety sensitive distribution centre. How long before other major chains try and follow suit?” More>>

ALSO:

Scoop Business: NZ-Korea FTA Signed Amid Spying, Lost Sovereignty Claims

A long-awaited free trade agreement between New Zealand and South Korea has been signed in Seoul by Prime Minister John Key and the Korean president, Park Geun-hye. More>>

ALSO:

PM Visit: NZ And Viet Nam Agree Ambitious Trade Target

New Zealand and Viet Nam have agreed an ambitious target of doubling two-way goods and service trade to around $2.2 billion by 2020, Prime Minister John Key has announced. More>>

ALSO:

Scoop Business: NZ Economy Grows 0.8% In Fourth Quarter

The New Zealand economy expanded in the fourth quarter as tourists drove growth in retailing and accommodation, and property sales increased demand for real estate services. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news