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

 


NZ Dollar Outlook: Kiwi moves hanging on overseas action

NZ Dollar Outlook: Kiwi moves likely to be determined by overseas events this week

By Tina Morrison

April 7 (BusinessDesk) – The New Zealand dollar will probably take its direction from overseas sentiment this week, with little on the local agenda as investors anticipate a rise in interest rates later this month.

The local currency may trade between 84 US cents and 87 cents this week, according to a BusinessDesk survey of 11 traders and strategists. Six predict the kiwi will fall this week, while one expects it to gain and four see it largely unchanged. It recently traded at 86.10 US cents.

Investors are weighing competing tensions regarding the pace of the US economic recovery, the potential for softer New Zealand commodity prices, the impact of a higher local currency on exporters and expectations for continued hikes in the New Zealand official cash rate.

“Markets have taken a deep breath ahead of the OCR review in two weeks which is expected to deliver an interest rate rise,” said Peter Cavanaugh, client advisor at Bancorp Treasury. “Globally it is more or less steady as she goes just waiting for the next round of central bank decisions or actions.”

Cavanaugh said the kiwi will be vulnerable to any unexpected shocks this week with no major events scheduled.

Locally, the main scheduled release is tomorrow’s Quarterly Survey of Business Opinion published by the New Zealand Institute of Economic Research. An optimistic reading could boost the kiwi higher, Cavanaugh said.

Today, state valuer Quotable Value is scheduled to publish its latest housing data for March, which will be eyed for signs Reserve Bank high-debt lending restrictions introduced in October are cooling the market. The Real Estate Institute may also publish its latest figures this week.

Other March data scheduled for release this week includes electronic card transactions on Wednesday, the BNZ-BusinessNZ Performance of Manufacturing Index on Thursday and food prices on Friday.

Treasury releases the latest crown accounts for the eight months through February tomorrow.

In Asia, central banks in Japan, Indonesia and South Korea are expected to keep monetary policy unchanged following meetings this week, according to Moody’s Analytics. The Bank of England is also expected to keep rates unchanged when it meets on Thursday.

In the US, traders will be eyeing minutes from the latest Federal Open Market Committee meeting, published early Thursday morning New Zealand time, alongside speeches by several US policy makers.

Federal Reserve speakers this week include St Louis Fed President James Bullard, Minneapolis Fed President Narayana Kocherlakota, Philadelphia Fed President Charles Plosser, Chicago Fed President Charles Evans and Fed Governor Daniel Tarullo.

US reports scheduled for release this week include consumer credit, on Monday; the NFIB small business optimism index, on Tuesday; wholesale trade, on Wednesday; weekly jobless claims, as well as import and export prices, on Thursday; and the producer price index, and consumer sentiment, on Friday.

In Australia this week, all eyes will be on Thursday’s employment data for February and tomorrow’s NAB business confidence survey. Even though Australia’s unemployment rate probably rose to 6.1 percent in March from February’s 6 percent level, and employment growth may not beat February’s gain, forward indicators suggest the labour market is close to troughing, according to Moody’s Analytics.

In China this week, March data on monetary aggregates scheduled for release on Thursday will indicate how increased liquidity in the interbank market is playing out as banks restrain lending because of tight balance sheets and fears of defaults, Moody’s Analytics says.

China is also scheduled to release March data for foreign trade on Thursday and for inflation and producer prices on Friday.

Meanwhile, the International Monetary Fund and World Bank will release updates to their outlooks ahead of the start of their spring meetings in Washington on Friday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Warming: Warming Signs From State Of Climate Report

Climate data from air, land, sea and ice in 2013 'reflect trends of a warming planet' -- says the latest State of the Climate report, launched by U.S. and New Zealand scientists. More>>

ALSO:

Scoop Business: Embrace Falling Home Affordability, Says NZIER

Despair over the inability to afford a house is misplaced and should be embraced as an opportunity to invest in more wealth-creating activity, says the principal economist at the New Zealand Institute of Economic Research, Shamubeel Eaqub. More>>

Productivity Commission: NZ Regulation Not Keeping Pace

New Zealand regulators often have to work with out-of-date legislation, quality checks are under strain, and regulatory workers need better training and development. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news