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

 


NZ dollar falls to week low against pound on BoE forecasts

NZ dollar falls to week low against pound after Bank of England ups growth forecasts

By Tina Morrison

Feb. 13 (BusinessDesk) – The New Zealand dollar dropped to a week low against the British pound after the Bank of England raised its growth forecasts, increasing speculation interest rates may rise next year.

The kiwi fell as low as 50.08 British pence and was trading at 50.11 pence at 8am in Wellington from 50.73 pence at 5pm yesterday. The local currency slipped to 83.15 US cents from 83.46 cents yesterday ahead of a report on US retail sales for January.

The Bank of England may be the second major central bank after New Zealand to raise interest rates this cycle as the UK economy improves. The BoE yesterday raised its forecast for 2014 growth to 3.4 percent from 2.8 percent and said the UK economy is gaining momentum, boosting demand for sterling.

“The BoE has said that it may start to hike its main cash rate as early as 2015 as the economic recovery starts to ramp up,” said Peter Cavanaugh, client adviser at Bancorp Treasury Services. “A 2015 interest rate hike would probably put the BoE as the second developed economy to raise official interest rates, following the RBNZ and, naturally, the GBP has rallied strongly.”

In New Zealand today, traders will be eyeing the latest BNZ-BusinessNZ PMI report at 10am which is expected to show continued strong expansion in January. Data for house sales in January is expected to be released about midday by the Real Estate Institute of New Zealand.

The New Zealand dollar was little changed at 92.03 Australian cents from 92.11 cents yesterday ahead of Australian labour market data scheduled for release at 1:30pm New Zealand time today. Economists expect Australia’s unemployment rate to have ticked higher to 5.9 percent from 5.8 percent.

Reserve Bank of Australia assistant governor Guy Debelle is scheduled to speak at a financial market event this afternoon while Federal Reserve chair Janet Yellen is set to deliver the Fed’s report to the Senate tonight.

The kiwi slipped to 61.13 euro cents from 61.23 cents yesterday after weak European industrial production data and comments from European Central Bank executive board member Benoit Coeure that the bank was very seriously considering a negative deposit rate.

The local currency weakened to 85.25 yen from 85.56 yen yesterday. The trade-weighted index dropped to 78.24 from 78.48 yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

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:

The Price Of Cheese: Cheddar At Eight-Year Low

Food prices decreased 0.5 percent in the year to June 2016, influenced by lower grocery food prices (down 2.3 percent), Statistics New Zealand said today. Compared with June 2015, cheese prices were down 9.5 percent, fresh milk was down 3.9 percent, and yoghurt was down 9.2 percent. More>>

ALSO:

Financial Advisers: New 'Customer-First' Obligations

Goldsmith plans to do away with the current adviser designations which he says have been "unsatisfactory" in that some advisers are obliged to disclose potential conflicts of interest and act in their customers' best interests, but others are not. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news