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


NZ dollar gains ahead of RBNZ statement

NZ dollar gains ahead of RBNZ statement seen as kicking off tightening cycle

By Paul McBeth

March 11 (BusinessDesk) - The New Zealand dollar gained in local trading on expectations the Reserve Bank will hike the official cash rate at this Thursday’s policy review, kicking off a prolonged tightening cycle.

The kiwi rose to 84.81 US cents at 5pm in Wellington from 84.64 cents at 8am and 84.61 cents yesterday. The trade-weighted index advanced to 79.50 from 79.19 yesterday.

Traders have lifted bets on a rate hike on Thursday, pricing in a 101 percent chance central bank governor Graeme Wheeler will raise the official cash rate, according to the Overnight Index Swap curve. Yesterday traders are pricing in a 98 percent chance. Wheeler has signalled interest rates will start rising this year as he attempts to head of the threat of future inflation as the local economy gathers momentum.

“The kiwi has certainly outperformed the Aussie, suggesting that it’s kiwi-specific,” said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. “It’s looking slightly bullish on the day, and as long as we don’t get any shenanigans from geopolitics, there’s every chance it could take a stab at 85.25 US cents.”

New Zealand house sales fell 7.6 percent in February from a month earlier, indicating the Reserve Bank’s curbs on low-equity home lending were having an effect on the lower end of the market, while government figures showed retail spending on credit and debit cards gained last month, led by increased spending on hospitality.

The kiwi rose to 93.92 Australian cents at 5pm in Wellington from 93.53 cents yesterday after the National Australia Bank business survey showed firms were gloomier in February after an optimistic January. The weak survey followed a drop in iron ore prices yesterday amid deteriorating Chinese trade figures.

The local currency gained to 87.61 yen from 87.22 yen yesterday after the Bank of Japan maintained its near-zero interest rate policy and affirmed an annual expansion of the monetary base by 60 to 70 trillion yen. Japan’s central bank said the economy is expected to continue with a moderate recovery, and anticipates annual inflation of 1.25 percent to persist for some time.

The kiwi gained to 61.15 euro cents at 5pm in Wellington from 60.91 cents yesterday, and reached a two-month high 50.98 British pence, trading at 50.95 pence at 5pm from 50.56 pence yesterday.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Hepatitis A Link: Increased Surveillance Of Imported Frozen Berries

The Ministry for Primary Industries (MPI) Director General has issued a statement warning of a potential risk associated with imported frozen berries following four human cases of Hepatitis A thought to be linked to packaged imported frozen berries. More>>


Shocking Dairy Footage: MPI Failing Our Animals And Damaging Our Reputation

Greens “Nathan Guy needs to urgently look into how his ministry is enforcing animal welfare standards, how these appalling incidents happened under its watch and what it’s going to do prevent similar incidents happening again in the future." More>>


Land & Water Forum: Fourth Report On Water Management

The Land and Water Forum (LWF) today published its fourth report, outlining 60 new consensus recommendations for how New Zealand should improve its management of fresh water and calling on the Government to urgently adopt all of its recommendations from earlier reports. More>>



Welcome Home: Record High Migration Stokes 41-Year High Population Growth

New Zealand annual net migration hit a new high in October as more people arrived from than departed for Australia for the first time in more than 20 years. More>>


Citizens' Advice Bureau: Report Shows Desperate Housing Situation Throughout NZ

CAB's in-depth analysis of over 2000 client enquiries about emergency accommodation shows vulnerable families, pregnant women and children living in cars and garages, even after seeking assistance from the Ministry of Social Development and Housing New Zealand. More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news