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

 


NZ dollar little changed amid concerns on global growth

NZ dollar little changed as manufacturing reports raise concerns about global growth

By Tina Morrison

March 25 (BusinessDesk) – The New Zealand dollar was little changed as manufacturing reports from major overseas economies raised concerns about global growth.

The kiwi edged up to 85.39 US cents at 8am in Wellington, from 85.37 cents at 5pm yesterday. The trade-weighted index weakened to 79.79 from 79.95 yesterday.

Reports for March manufacturing in China, the US and Germany over the past 24 hours failed to meet expectations. That’s in contrast with New Zealand, where a report on fourth quarter gross domestic product printed in line with forecasts last week as the nation’s central bank raised the benchmark interest rate on concern about rising inflation.

“The China HSBC PMI, German PMI and the US Markit PMI were all weaker than expectations, delaying the view for recovery,” ANZ Bank senior economist Mark Smith and senior FX strategist Sam Tuck said in a note. “Domestic factors ensure NZD/USD will remain strong on slow global growth.”

Yesterday, China’s flash Markit/HSBC Purchasing Managers’ index fell to an eight-month low of 48.1 in March, from 48.5 in February and expectations of 48.7. The index has remained below 50 this year, indicating a contraction in the sector.

Separately, the preliminary Markit US PMI manufacturing report slipped to 55.5 in March from 57.1 in February and expectations of 56.5.

Meantime, while Eurozone manufacturing PMI eased only slightly to 53 from 53.2, the German reading dropped to 53.8 from 54.8 in February and expectations of 54.5, raising concerns about the region’s largest economy.

Tonight, the German IFO business confidence survey for March will be closely watched.

Also underpinning the New Zealand dollar against the US currency overnight, San Francisco Federal Reserve president John Williams suggested in an interview with the Washington Post that financial markets were wrong to interpret that the Federal Reserve would tighten monetary policy sooner than previously expected.

Today, traders will be eyeing a speech in Hong Kong by Reserve Bank of Australia deputy governor Philip Lowe titled ‘Opportunities and Challenges for Market-based Financing’.

With the Australian currency at elevated levels, the central bank may be tempted to talk it lower, Bank of New Zealand currency strategist Raiko Shareef said in a note.

The New Zealand dollar touched a two-week low of 93.45 Australian cents, and was trading at 93.50 cents at 8am in Wellington from 93.97 cents at 5pm yesterday.

Traders have increased their bets that the Reserve Bank of Australia will raise interest rates in the coming year, with the Overnight Swap Curve showing expectations for 16 basis points of hikes in the next 12 months, compared with expectations of 3 basis points of cuts at the start of the month.

The kiwi slipped to 87.28 yen from 87.43 yen, weakened to 61.70 euro cents from 61.84 cents and was unchanged at 51.76 British pence.

Reports on UK February inflation and US consumer confidence for March are scheduled for publication later today.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Auckland Transport Case: Men Guilty Of Corruption And Bribery Will Spend Time In Jail

Two men who were found guilty of corruption and bribery in a Serious Fraud Office (SFO) trial have been sentenced in the Auckland High Court today... The pair are guilty of corruption and bribery offences relating to more than $1 million of bribes which took place between 2005 and 2013 at Rodney District Council and Auckland Transport. More>>

ALSO:

Hager Raid: Westpac Wrong To Release Bank Records To Police

The Privacy Commissioner has censured Westpac Banking Corp for releasing without a court order more than 10 months of bank records belonging to the political activist and journalist Nicky Hager during a police investigation into leaked information published in Hager's 2014 pre-election book, 'Dirty Politics'. More>>

ALSO:

EARLIER:

Crown Accounts: Government Ekes Out Six-Month Surplus Of $9M

The New Zealand government eked out a tiny surplus in the first six months of the fiscal year as growth in domestic consumption lifted the goods and services tax take, while uncertainties over the Kaikoura earthquake costs meant expenses were less than expected. More>>

ALSO:

Almost 400 Jobs: Shock At Cadbury's Dunedin Factory Closure

Workers at Cadbury in Dunedin are reeling after learning this morning that the iconic Cadbury factory is to close, with the loss of almost 400 jobs... “The company had reported it was doing well and this has come out of the blue,” says Chas. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news