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


NZ dollar falls on growing confidence in US recovery

NZ dollar falls after positive US data boosts confidence about revival in world’s largest economy

By Tina Morrison

April 22 (BusinessDesk) – The New Zealand dollar weakened after positive US data boosted confidence about a revival in the world’s largest economy, reinforcing expectations the Federal Reserve will continue to pull back its stimulus this year.

The kiwi fell to 85.59 US cents at 8am in Wellington from 85.65 cents at 5pm yesterday and 86.17 cents at 5pm on Thursday. New Zealand markets were closed on Friday and Monday for the Easter public holiday although US markets were open yesterday. The trade-weighted index slipped to 79.66 from 79.98 on Thursday.

The US dollar index, which measures the greenback against a basket of currencies, advanced over the Easter period and early this morning touched a two-week high as leading US economic indicators backed up speculation the Fed will continue to remove stimulus this year. Traders were buoyed by better-than-expected US jobless claims and the Philadelphia Fed manufacturing index which jumped to a seven-month high in April.

“Markets took these outturns as further signs that the US economy is pulling itself out of the weather-related doldrums,” Bank of New Zealand currency strategist Raiko Shareef said in a note.

The US dollar also found support after Russia, the US, the EU and Ukraine agreed to disarm all armed groups, an amnesty for most of those recently detailed and the vacating of occupied streets, Shareef said. Even so, both sides are already accusing the other of violating the terms of the agreement, he said.

Today, the focus will be on US existing home sales, the Richmond Fed manufacturing index and euro-zone consumer confidence. Traders will also keep an eye on developments in Ukraine.

For this week, the focus in New Zealand is the Reserve Bank’s decision on interest rates Thursday. All 15 economists in a Reuters survey expect the central bank will lift the official cash rate a quarter point to 3 percent.

The New Zealand dollar is likely to remain in its 85 US cent to 87 cent range it has been in since the central bank first started hiking rates on March 13, ANZ Bank said in a note.

In Australia, the Conference Board Leading Index for February is scheduled for publication at midday. The New Zealand dollar slipped to 91.76 Australian cents at 8am from 92.07 cents at 5pm on Thursday.

The kiwi edged lower to 87.83 yen from 87.89 cents on Thursday, dropped to 50.97 British pence from 51.20 pence and weakened to 62.06 euro cents from 62.27 cents.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Banks: Westpac Keeps Core Government Transactions Contract

The local arm of Westpac Banking Corp has kept its contract with the New Zealand government to provide core transactions, but will have to share peripheral services with its rivals. More>>


Science Investment Plan: Universities Welcome Statement

Universities New Zealand has welcomed the National Statement of Science Investment released by the Government today... this is a critical document as it sets out the Government’s ten-year strategic direction that will guide future investment in New Zealand’s science system. More>>


Scouring: Cavalier Merger Would Extract 'Monopoly Rents' - Godfrey Hirst

A merger of Cavalier Wool Holdings and New Zealand Wool Services International's two wool scouring operations would create a monopoly, says carpet maker Godfrey Hirst. The Commerce Commission on Friday released its second draft determination on the merger, maintaining its view that the public benefits would outweigh the loss of competition. More>>


Scoop Review Of Books: She Means Business

As Foreman says in her conclusion, this is a business book. It opens with a brief biographical section followed by a collection of interesting tips for entrepreneurs... More>>


Hourly Wage Gap Grows: Gender Pay Gap Still Fixed At Fourteen Percent

“The totally unchanged pay gap is a slap in the face for women, families and the economy,” says Coalition spokesperson, Angela McLeod. Even worse, Māori and Pacific women face an outrageous pay gap of 28% and 33% when compared with the pay packets of Pākehā men. More>>


Housing: English On Housing Affordability And The Economy

"Long lead times in the planning process tend to drive prices higher in the upswing of the housing cycle. And those lead times increase the risk that eight years later, when additional supply arrives, the demand shock that spurred the additional supply has reversed. The resulting excess supply could produce a price crash..." More>>


Get More From Scoop

Search Scoop  
Powered by Vodafone
NZ independent news