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

 


NZ dollar advances as Fed's Yellen seen continuing support

NZ dollar advances as Federal Reserve’s Yellen seen continuing asset purchases

By Tina Morrison

April 1 (BusinessDesk) – The New Zealand dollar advanced as investors bet the US Federal Reserve will continue to pull back on its quantitative easing programme even as chair Janet Yellen signalled the world’s largest economy will need support for some time.

The kiwi rose to 86.73 US cents at 8am in Wellington, from 86.55 cents at 5pm yesterday. The trade-weighted index edged up to 80.91 from 80.86 yesterday.

Yellen signalled considerable slack is still present in the US economy and the labour market, with most Fed officials seeing the equilibrium level of unemployment between 5.2 percent and 5.6 percent, below the current 6.7 percent. Still, Bank of New Zealand currency strategist Raiko Shareef said it took just 13 months for the US unemployment rate to fall by a similar amount to the current level, in line with Yellen’s recent comments that interest rate hikes could come six months after an end to the Fed’s quantitative easing programme.

Investors “have taken Fed chair Janet Yellen’s dovish comments in stride this morning because even as she says the Fed is short of reaching its employment and inflation goals, she is still committed to tapering asset purchases at each successive meeting,” Kathy Lien, managing director of FX strategy for BK Asset Management in New York, said in a note. “We believe that most of this week’s US economic reports will show a continued recovery in the US economy.”

Tonight, investors will be eyeing the US ISM manufacturing index.

In Asia today, the focus will be on China’s official manufacturing PMI for March at 2pm New Zealand time and the final reading of the HSBC version at 2:45pm.

The New Zealand dollar weakened to 93.49 Australian cents from 93.75 cents yesterday ahead of the Reserve Bank of Australia’s decision on interest rates at 4:30pm New Zealand time today. The central bank is expected to keep the benchmark rate at 2.5 percent and reiterate that rates will remain stable.

The kiwi touched a fresh six year high of 89.52 Japanese yen overnight. The local currency was trading at 89.48 yen at 8am from 89.03 yen yesterday.

Demand for the yen may be softer as tensions ease between Russia and the Ukraine and on speculation that Japanese asset managers will reallocate into domestic equities and international assets in the new financial year which begins today, BNZ said.

The New Zealand dollar was little changed at 52.01 British pence from 52.04 pence yesterday and unchanged at 62.95 euro cents after weaker than expected European inflation in March.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Gambling: SkyCity First Half Profit Rises 30%, Helped By High Rollers

SkyCity anticipates the Auckland business will benefit from government gaming concessions which were triggered on Nov. 11 in recognition of SkyCity’s $470 million Convention Centre development. Morrison said the concessions would allow the Auckland business to lift its activity during peak period, noting it had a record revenue week over the Christmas and New Year period. More>>

ALSO:

Money For Light: Kiwi Scientists Secure Preferential Access To Synchrotron

Science and Innovation Minister Steven Joyce today announced a three-year investment of $2.8 million in the Australian Synchrotron, the largest piece of scientific infrastructure in the Southern Hemisphere, to secure preferential access for Kiwi scientists. More>>

Telco Industry Report: Investment Hits $1.7 Bln A Year

Investment in the telecommunications sector is $1.7 billion a year, proportionately one of the highest levels in the OECD, according to a report released today on the status of the New Zealand sector. More>>

ALSO:

PGPs: New Programme Sets Sights On Strong Wool

A new collaboration between The New Zealand Merino Company (NZM) and the Ministry for Primary Industries (MPI), announced today, aims to deliver premiums for New Zealand's strong wool sector... More>>

ALSO:

Restrictions Lifted: No Further Tau Flies Found

The Ministry for Primary Industries (MPI) confirms that all restrictions on the movement of fruit and vegetables in Manurewa, Auckland, due to the Tau fly, have been lifted as of 2.26pm on Sunday 7 February. More>>

Crowdfinding: Awaroa Beach To Become Public Land If Appeal Succeeds

Conservation Minister Maggie Barry says a privately-owned beach will become part of the Abel Tasman National Park if an online crowdfunding campaign to buy it succeeds... More>>

ALSO:

Meat Workers Union: Waitangi Mondayisation Flaunted By Large Employer Of Maori

At the AFFCO Talley owned meat plant in Rangiuru, the company has resorted to bullying and threats... saying they could be disciplined and their union sued for an unlawful strike if workers exercise their rights to a paid day off tomorrow. More>>

Earlier:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news