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

 


NZ Dollar Outlook: Kiwi set to fall on Ukraine tension, Fed

NZ Dollar Outlook: Kiwi set to move lower as Ukraine tension, Fed taper weigh

By Tina Morrison

March 17 (BusinessDesk) – The New Zealand dollar may decline from elevated levels this week as concerns about tensions in Ukraine and a likely pullback in stimulus by the Federal Reserve weigh on the currency.

The local dollar may trade between 83.40 US cents and 86.50 cents this week, according to a BusinessDesk survey of nine traders and strategists. Six predict the kiwi will decline this week, while one expects an increase and two see it largely unchanged. The kiwi recently traded at 85.36 US cents from 85.25 cents at 8am.

Investors are cautious, favouring the safe haven Japanese yen, after Crimean voters in a weekend poll chose to break with Ukraine and join Russia, prompting concern about retaliation from the West. Also weighing on the kiwi this week, the Federal Reserve is expected to continue to pull back its stimulus by US$10 billion a month, adding strength to the greenback.

“Recent elevated levels have left the kiwi somewhat extended and those two major factors will weigh on us this week,” said Stuart Ive, senior advisor at OMF. “That may find the kiwi struggling a little bit to gain any further ground against the US dollar.”

The Federal Reserve this week holds its first monetary policy meeting chaired by Janet Yellen and economists expect she will push to continue the policy of reducing stimulus. The decision is scheduled for release on Thursday morning New Zealand time.

Also in the US this week, data on industrial production and housing should bounce following poor weather, while February inflation likely stayed tame, UBS economist Robin Clements said in a note.

In New Zealand this week, fourth quarter data is released on the balance of payments on Wednesday and gross domestic product on Thursday.

GDP rose 0.9 percent in the final three months of 2013, based on a Reuters survey of 11 economists. The current account gap narrowed to $1.4 billion for an annual deficit of $7.4 billion, or 3.3 percent of GDP, a separate survey showed.

The data is unlikely to knock the New Zealand dollar off its perch, ANZ Bank said in a research note.

On Wednesday morning, the latest GlobalDairyTrade report is published, and prices may be under pressure from higher production.

On Friday, tourist arrival data for February is released at 10:45am, while the ANZ-Roy Morgan consumer confidence survey for March will be released at 1pm and credit card spending for February will be published at 3pm.

In Australia, traders will be eyeing tomorrow’s release of the Reserve Bank of Australia’s minutes from their meeting this month.

Little new information is expected from the minutes, while other Australian data on car sales, goods imports and skilled vacancies are second tier and unlikely to move markets, UBS’s Clements said.

Meantime in the UK this week, data will be released on unemployment and the UK budget while the minutes of the Bank of England’s last meeting are scheduled for publication.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: NZ Dollar Catches Breath After "Goldilocks" Slump

The New Zealand dollar edged up following its dramatic slump yesterday after the Reserve Bank confirmed speculation it intervened in the currency market last month and PM John Key suggested a “Goldilocks” level far lower than at present. More>>

ALSO:

Biosecurity: Kiwifruit Claim To Hold Officials Accountable For Psa

Kiwifruit growers have joined forces to hold Biosecurity NZ accountable in the courts for its negligence in allowing 2010’s Psa outbreak that devastated New Zealand’s kiwifruit industry and exports. Foundation claimants representing well ... More>>

ALSO:

Poison: Anglers Advised Not To Eat Trout In 1080 Areas

With the fishing season opening in just a few days (1 October 2014), anglers are being warned by the Department of Conservation(DOC) not to eat trout from pristine backcountry waters and their downstream catchments, where the department is conducting 1080 poisoning operations. More>>.

ALSO:

Quotas: MPI Swoop On Suspected Fraudulent Fishing Activity

Ministry for Primary Industries (MPI) compliance officers swooped on a Hawkes Bay fishing enterprise today to secure evidence in an investigation into suspected fraudulent activity... “The investigation involves activity throughout the commercial supply chain – catching, landing, processing and exporting.” More>>

ALSO:

Scoop Business: Fonterra Slashes 2015 Milk Payout, Earnings Tumble 76%

Fonterra Cooperative Group cut its forecast 2015 milk price payout by about 12 percent, citing weaker global dairy prices and said there is a risk of further declines given strong global milk production. More>>

ALSO:

Scoop Business: RBNZ Keeps OCR At 3.5%, Signals Slower Pace Of Future Hikes

Reserve Bank governor Graeme Wheeler kept the official cash rate at 3.5 percent and signalled he won’t be as aggressive with future rate hikes as previously thought as inflation remains tamer than expected. The kiwi dollar fell to a seven-month low. More>>

ALSO:

Weather: Dry Spells Take Hold In South Island

Many areas in the South Island are tracking towards record dry spells as relatively warm, dry weather that began in mid-August continues... for some South Island places, the current period of fine weather is quite rare. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand

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