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

 


"Risk-off" suddenly in vogue for kiwi dollar

"Risk-off" suddenly in vogue for kiwi dollar as emerging market concerns stifle risk appetite

By Paul McBeth

Jan. 24 (BusinessDesk) - The New Zealand dollar was little changed as concerns about emerging markets eroded investors’ appetite for risky assets after Argentina devalued the peso and Turkey’s lira plunged when its central bank intervened in foreign exchange markets.

The kiwi traded at 82.88 US cents at 8am, paring a gain in Northern Hemisphere trading, from 82.84 cents at 5pm in Wellington yesterday. The trade-weighted index dropped to 78.43 from 78.61 yesterday.

Argentina’s peso slumped 14 percent to 7.90 per US dollar after policy makers stopped buying foreign currency to prop up the peso in a bid preserve the central bank’s reserves, and Turkey’s lira weakened 1.6 percent to 2.2934 per US dollar after the nation’s central bank in a bid to shore up the currency. That raised fears about the strength of emerging economies, which were already on the back foot after a weaker than expected Chinese manufacturing report yesterday.

“It’s been a while since we’ve had an old-fashioned risk-off day and that’s what this is,” said Sam Tuck, senior FX strategist at ANZ New Zealand in Auckland. “That’s why the kiwi’s off from above 83 (US cents).”

The currency may trade between 82.20 US cents and 83.20 cents today, according to ANZ economists.

ANZ’s Tuck said the fears over emerging markets weighed more heavily on the Australian dollar than the kiwi, which rose to 94.59 Australian cents from 94.03 cents yesterday.

Investors will note the Reserve Bank’s December credit card spending figures for release today.

The local currency fell to 60.54 euro cents at 8am in Wellington from 61.06 cents yesterday after better than expected European manufacturing figures bolstered confidence in the eurozone’s economy.

The kiwi fell to 85.48 yen from 86.37 yen yesterday, and slipped to 49.85 British pence from 49.93 pence.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Fruitful Endeavours: Kiwifruit Exports Reach Record Levels

In June 2016, kiwifruit exports rose $105 million (47 percent) from June 2015 to reach $331 million, Statistics New Zealand said today. Overall, goods exports rose $109 million (2.6 percent) in June 2016 (to $4.3 billion). More>>

ALSO:

Economic Update: RBNZ Says Rate Cut Seems Likely

The Reserve Bank will likely cut interest rates further as a persistently strong kiwi dollar makes it difficult for the bank to meet its inflation target, it said. The local currency fell. More>>

ALSO:

House Price Action Plan: RBNZ Signals National Lending Restrictions

The central bank wants to cap bank lending to property investors with a deposit of less than 40 percent at 5 percent and restore the 10 percent limit for owner-occupiers wanting to take out a mortgage with a deposit of less than 20 percent, according to a consultation paper released today. More>>

ALSO:

Sparks Fly: Gordon Campbell On China Steel Dumping Allegations

No doubt, officials on the China desk at MFAT have prided themselves on fashioning a niche position for New Zealand right in between the US and China – and leveraging off both of them! Well, as the Aussies would say, of MFAT: tell ‘em they’re dreaming. More>>

ALSO:

Loan Sharks: Finance Companies Found Guilty Of Breaching Fair Trading Act

Finance companies Budget Loans and Evolution Finance, run by former 1980s corporate high-flyer Allan Hawkins, have been found guilty of 106 charges of breaching the Fair Trading Act for misleading 21 borrowers while enforcing loan contracts. More>>

ALSO:

Post Panama Papers: Govt To Adopt Shewan's Foreign Trust Recommendations

The government will adopt all of the recommendations from former PwC chairman John Shewan to increase disclosure and introduce a register for foreign trusts with new legislation to be introduced next month. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news