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

 


NZ dollar gains on lure of higher interest rates

NZ dollar gains on lure of higher interest rates

By Paul McBeth

April 8 (BusinessDesk) - The New Zealand dollar gained as volatility in equity markets failed to spill over into foreign exchange, and the kiwi remained an attractive buy on the prospect of higher interest rates later this month.

The kiwi rose to 86.30 US cents at 5pm in Wellington from 86.03 cents at 8am and 85.92 cents yesterday. The trade-weighted index advanced to 80.52 from 80.31.

Traders are pricing in a 96 percent chance of a rate hike at the Reserve Bank’s April 24 meeting, according to the Overnight Index Swap curve. New Zealand’s central bank began tightening monetary policy last month as a means to head off the threat of future inflation, putting the country at the front of the cycle compared to its global peers. That makes New Zealand rates attractive, with the yield on the 10-year government bond, at 4.63 percent, more than half a percentage point higher than its Australian equivalent.

“We’re going to get another rate hike in the next two weeks” which is still attracting investors, said Tim Kelleher, head of institutional FX sales NZ at ASB Institutional in Auckland. “The kiwi’s still got a bias to the topside.”

Still, ASB’s Kelleher said volatility in US stock markets didn’t feed into currency markets yesterday, and a diminished appetite for risk-sensitive assets could weigh on the kiwi.

New Zealand business confidence remained upbeat in the first quarter according to the New Zealand Institute of Economic Research’s quarterly survey of business opinion, with a net 52 percent of firms positive on the outlook for general business.

The kiwi gained to 92.87 Australian cents from 92.63 cents yesterday after the National Australia Bank monthly business survey showed weaker sentiment among firms.

The local currency rose to 88.83 yen from 88.57 yen yesterday after the Bank of Japan kept its monetary stimulus package unchanged at the conclusion of its two-day policy review, against expectations of an increase.

The kiwi was little changed at 62.78 euro cents from 62.71 cents yesterday, and traded at 51.92 British pence from 51.84 pence.

(BusinessDesk)


© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Tubes: Tasman Global Access Cable Goes Live

Spark, Vodafone and Telstra have today announced the Tasman Global Access (TGA) cable is officially in service and ready to carry vast quantities of Internet traffic between New Zealand and the world. More>>

ALSO:

Theresa Does: Brexit Letter Sees NZD Touch Week-High Vs GBP On Brexit

The New Zealand dollar rose to a week-high against the British pound and euro after UK Prime Minister Theresa May officially triggered Britain's exit from the European Union. More>>

ALSO:

Statistics: Business Research And Development Up 29 Percent

Computer services and machinery manufacturing firms led the way in an almost 30 percent lift in business spending on research and development (R&D) in 2016, Stats NZ said today. Businesses spent $1.6 billion on R&D in 2016, up $356 million (29 percent) from 2014. More>>

ALSO:

China Shopping: NZ-China FTA Upgrade Agreed Among Slew Of New Deals

New Zealand Prime Minister Bill English and China Premier Li Keqiang signed off a series of cooperation deals spanning trade, customs, travel and climate change and confirmed commencement of official talks on an upgrade to the nine-year old free-trade agreement between the two countries. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news