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

 


NZ dollar pares decline vs. A$ after RBA affirms rate stance

NZ dollar pares decline vs. A$ after RBA affirms rate stance

By Paul McBeth

March 4 (BusinessDesk) - The New Zealand dollar pared losses against its trans-Tasman counterpart after the Reserve Bank of Australia affirmed its policy of keeping the cash rate unchanged while it waits to see whether the low interest rate environment will support the economic recovery.

The kiwi rose to 90.67 Australian cents at 5pm in Wellington from 93.37 cents immediately before the RBA release, and unchanged from 93.67 cents yesterday. The kiwi traded at 83.65 US cent at 5pm, unchanged from 8am, and up from 83.53 cents yesterday.

The RBA kept the cash rate at 2.5 percent, with governor Glenn Stevens saying “monetary policy is appropriately configured to foster sustainable growth in demand and inflation outcomes consistent with the target” and that the most prudent course is to keep rates unchanged for a while. Strong Australian building consent figures earlier in the day had put pressure on the kiwi against its trans-Tasman partner, though that was erased by the RBA announcement.

The RBA “don’t want to cut rates or be seen that they’re looking to cut with a very buoyant housing market fuelling by lower interest rates,” said Stuart Ive, senior client adviser at OMF in Wellington.
“Building consents were a lot better than expect and that put pressure on the kiwi/Aussie.”

The RBA announcement comes a week before New Zealand’s central bank reviews monetary policy at a meeting that’s expected to see the first hike in a tightening cycle as governor Graeme Wheeler looks to head off the threat of future inflation.

OMF’s Ive said the rate hike has been well-telegraphed and the market has probably fully priced it in.

Ongoing tensions in Ukraine, where Russia is threatening to annex the Crimean Peninsula, may stoke some risk aversion among investors after a sell-off on equity markets yesterday, though Asian stocks were up in afternoon trading. The kiwi traded at 30.55 Russian rubles at 5pm in Wellington from 30.14 rubles yesterday, having touched a record 30.65 rubles earlier in the day.

The local currency climbed to 85 yen at 5pm in Wellington from 84.69 yen yesterday, and rose to 60.93 euro cents from 60.62 cents. It gained to 50.23 British pence from 49.87 pence. The trade-weighted index gained to 78.62 from 78.39.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Auckland Outage: Power Mostly Restored Overnight

Vector wishes to advise that all but 324 customers have been restored overnight. These customers are spread throughout the network in small pockets. The main St Johns feeder was restored around midnight allowing most of the customers in all affected areas to have power this morning. More>>

ALSO:

Half Empty: Dairy Prices Drop To Lowest Since August 2009

Dairy product prices fell to the lowest level in more than five years in the latest GlobalDairyTrade auction, led by declines in butter milk powder and whole milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news