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

 


NZ dollar hits 8-yr high vs. A$ as RBA talks down currency

NZ dollar touches fresh 8-year high vs. A$ as RBA talks down currency

By Tina Morrison

Jan. 27 (BusinessDesk) – The New Zealand dollar touched a fresh eight year high against its trans-Tasman counterpart after an Australian central bank member said the Aussie currency should be lower.

The kiwi hit 95.31 Australian cents over the weekend, its highest level since Dec. 1, 2005. The local currency was trading at 94.61 Australian cents at 8am in Wellington from 94.48 cents at 5pm on Friday.

The New Zealand dollar touched a two-week low of 82.08 US cents over the weekend as investors moved away from riskier assets. It was trading at 82.32 US cents at 8am from 82.11 cents at the New York close and 82.81 cents at 5pm on Friday.

Investors are favouring so-called safe haven assets such as the Japanese yen, Swiss franc, US dollar, US Treasuries and gold and selling riskier assets such as the high-yielding New Zealand dollar and stocks on concern about emerging markets. The local currency continued its ascent against the Australian dollar after Australian central bank board member Heather Ridout was quoted in the Wall Street Journal on Friday saying the Aussie had not fallen far enough.

“The kiwi/Aussie still looks very buoyant to the upside,” said Stuart Ive, senior adviser at OMF, who expects the cross rate may consolidate around 94.50 cents.

Ive said the kiwi is being impacted by an investor “flight to quality”.

“People are getting out of their riskier investments which may be stock market shares or a higher yielding currency and they are willing to sacrifice the gains that they could possibly get in there for safety as we enter a relatively uncertain moment in time,” he said. “There are still some adjustments taking place in global economies.”

The Federal Reserve has its first meeting of the year this week and may continue to taper its US$75 billion a month bond-buying programme. New Zealand’s central bank also meets this week, with some traders expecting an interest rate hike.

Australian banks are closed today for Australia Day.

In New Zealand, the Performance Services Index for December is scheduled for release at 10:30am. Auckland has a public holiday.

The New Zealand dollar touched a seven-week low of 83.91 yen over the weekend and was trading at
84.25 yen at 8am from 85.67 yen on Friday.

The kiwi touched a three week low of 59.89 euro cents at the weekend and was trading at 60.19 cents at 8am from 60.50 cents on Friday.

The local currency advanced to 49.94 British pence from 49.77 pence on Friday. The trade-weighted index slipped to 78.11 from 78.42 on Friday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Interest Rates: Wheeler Hikes OCR To 3% On Inflationary Pressures, Eyes Kiwi

Reserve Bank governor Graeme Wheeler lifted the official cash rate for the second time in as many months, saying non-tradable inflationary pressures were "becoming apparent" in an economy that’s picking up pace and he's watching the impact of a strong kiwi dollar on import prices. More>>

ALSO:

Scoop Business: Equity Crowd Funding Carries Risks, High Failure Rate

Equity crowd funding, which became legal in New Zealand this month, comes with a high risk of failure based on figures showing existing forays into social capital have a success rate of less than 50 percent, one new entrant says. More>>

ALSO:

Scoop Business: NZ Migration Rises To 11-Year High In March

The country gained a seasonally adjusted 3,800 net new migrants in March, the most since February 2003, said Statistics New Zealand. A net 400 people left for Australia in March, down from 600 in February, according to seasonally adjusted figures. More>>

ALSO:

Hugh Pavletich: New Zealand’s Bubble Economy Is Vulnerable

The recent Forbes e-edition article by Jesse Colombo assesses the New Zealand economy “ 12 Reasons Why New Zealand's Economic Bubble Will End In Disaster ”, seems to have created quite a stir, creating extensive media coverage in New Zealand. More>>

ALSO:

Thursday Market Close: Genesis Debut Sparks Energy Rally

New Zealand stock rose after shares in the partially privatised Genesis Energy soared as much as 18 percent in its debut listing on the NZX, buoying other listed energy companies in the process. Meridian Energy, MightyRiverPower, Contact Energy and TrustPower paced gains. More>>

ALSO:

Power Outages, Roads Close: Easter Storm Moving Down Country

The NZ Transport Agency says storm conditions at the start of the Easter break are making driving hazardous in Auckland and Northland and it advises people extreme care is needed on the regions’ state highways and roads... More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news