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

 

NZ dollar gains after Putin talks down Ukraine invasion

NZ dollar gains as risk appetite recovers after Putin allays fears of imminent military action

By Tina Morrison

March 5 (BusinessDesk) – The New Zealand dollar advanced as investors gained confidence that tensions in Ukraine were easing, stoking demand for risk-sensitive assets.

The kiwi rose as high as 84 US cents early this morning and was trading at 83.73 cents at 8am in Wellington, from 83.64 cents at 5pm yesterday. The trade-weighted index increased to 78.72 from 78.60 yesterday.

Global risk appetite returned after Russian president Vladimir Putin told a news conference he saw no need to use military force in Ukraine’s Crimea region for now. The apparent easing of tensions pushed up European and US equities and US interest rates while damping demand for gold and oil.

“The New Zealand dollar is slightly stronger against the US dollar, helped by rebounding global risk appetite,” Bank of New Zealand currency strategist Raiko Shareef said in a note. “With a dearth of data releases overnight, markets were driven mostly by developments in Ukraine. We remain cautious on this risk rally, as developments still have some way to run.”

The New Zealand dollar advanced to 85.56 yen from 84.98 yen yesterday as investors reduced their holdings of the safe haven Japanese currency.

Dairy prices fell 4 percent on a trade-weighted basis, with a 5.7 percent slide in the price of whole milk powder on Fonterra Cooperative’s GlobalDairyTrade auction. The sale comes after government figures showed the New Zealand's terms of trade gained 2.3 percent in the fourth quarter, to the highest level since December 1973, driven by dairy products.

“Fonterra’s GlobalDairyTrade auction overnight showed a modest fall in prices from the previous auction a fortnight ago but are still strong by historical standards,” Peter Cavanaugh, client adviser at Bancorp Treasury Services said in a note.

In New Zealand today, data on fourth quarter building work will be released at 10:45am.

In China, traders will be looking for updated 2014 growth targets as the National People’s Congress annual meeting begins today. Also of interest, the Chinese HSBC/Markit PMI Services Index for February will be released at 3:45pm New Zealand time.

The kiwi was little changed at 93.63 Australian cents from 93.67 cents yesterday after the Australian central bank yesterday kept its benchmark interest rate on hold as expected and retained its neutral bias.

Today, Australia publishes its fourth quarter GDP data at 1:30pm New Zealand time which is expected to show a tick up in growth.

The local currency increased to 60.98 euro cents from 60.91 cents yesterday and was almost unchanged at 50.22 British pence from 50.21 pence.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Water: Farming Leaders Pledge To Help Make Rivers Swimmable

In a first for the country, farming leaders have pledged to work together to help make New Zealand’s rivers swimmable for future generations. More>>

ALSO:

Unintended Consequences: Liquor Change For Grocery Stores On Tobacco Tax

Changes in the law made to enable grocery stores to continue holding liquor licences to sell alcohol despite increases in tobacco taxes will take effect on 15 September 2017. More>>

Back Again: Government Approves TPP11 Mandate

Trade Minister Todd McClay says New Zealand will be pushing for the minimal number of changes possible to the original TPP agreement, something that the remaining TPP11 countries have agreed on. More>>

ALSO:

By May 2018: Wider, Earlier Microbead Ban

The sale and manufacture of wash-off products containing plastic microbeads will be banned in New Zealand earlier than previously expected, Associate Environment Minister Scott Simpson announced today. More>>

ALSO:

Snail-ier Mail: NZ Post To Ditch FastPost

New Zealand Post customers will see a change to how they can send priority mail from 1 January 2018. The FastPost service will no longer be available from this date. More>>

ALSO:

Property Institute: English Backs Of Debt To Income Plan

Property Institute of New Zealand Chief Executive Ashley Church is applauding today’s decision, by Prime Minister Bill English, to take Debt-to-income ratios off the table as a tool available to the Reserve Bank. More>>

ALSO: