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

 


NZ dollar gains as prospect of more central bank stimulus

NZ dollar gains as prospect of more central bank stimulus dents greenback demand

By Paul McBeth

May 14 (BusinessDesk) - The New Zealand dollar gained amid speculation central banks in the US and Europe will retain stimulatory conditions, helping underpin growth and driving stocks higher.

The kiwi rose to 86.58 US cents at 5pm in Wellington from 86.30 cents at 8am, when it was unchanged from 5pm yesterday. The trade-weighted index advanced to 80.46 from 80.21 yesterday.

US stock markets reached new records as government figures showed US retail sales grew 0.1 percent in April, below expectations, raising the prospect the Federal Reserve will have to keep near-zero interest rates for longer than expected. A recovering US economy and rising interest rates are expected to see the greenback appreciate, with weak data damping demand for the world’s reserve currency. The US dollar also came under pressure from reports that Germany’s Bundesbank was willing to back an array of measures by the European Central Bank, paving the way for the way for increased stimulus in the region.

“Stock markets continued to climb and there was a continuation of risk-on sentiment being helped by the US data at the moment,” said Alex Hill, head of dealing at HiFX in Auckland. “The US dollar was sold across the board – you can bet against it in the short- and medium-term, but not the long-term.”

HiFX’s Hill said the kiwi has support at 85.80 US cents, and faces resistance at 87 cents.

Local news didn’t deter the gains, after the Reserve Bank affirmed its view that New Zealand’s financial system is in relatively good health, with restrictions on low-equity mortgage lending damping the property market, while government figures showed a slowdown in the pace of consumer spending growth.

Traders will be watching the US producer price index on Wednesday in Washington ahead of the consumer price index on Friday for a gauge on inflation in the world’s biggest economy.

The kiwi was little changed at 92.15 Australian cents from 92.22 cents yesterday after Australia’s Federal government announced austerity measures in the face of large fiscal deficits.

The local currency climbed to 63.11 euro cents from 62.72 cents yesterday, and gained to 51.36 British pence from 51.12 pence. It advanced to 88.43 yen from 88.24 yen yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

OceanaGold: Man Killed In Waihi Mine Accident

A 29-year-old man had died following a work place accident at OceanaGold mine, Waihi last night. The man was killed after the front end loader he was in rolled down a slope. The accident happened at approximately 6.30pm on Thursday night. More>>

ALSO:

Constructing Consent: Annual Housing Consents Highest In Over A Decade

More than 29,000 new homes gained building consent in the year to June 2016, up 16 percent from the previous June year, Statistics New Zealand said today. More>>

ALSO:

War Against Weevil For Future Peas: “No Peas, No Weevil” Ban Now In Place In Wairarapa

The Ministry for Primary Industries (MPI) has today placed a ban on growing peas within a specified area and placed controls on moving pea material (seed and untreated pea straw) within, in and out of this area for the next 2 years. More>>

ALSO:

Wood Producers: Crisis In New Zealand Log Supply

New Zealand wood processing leaders held a hui with senior government officials and political leaders in Whangarei yesterday to assess the acute log supply shortage to local mills in Northland. More>>

Consents And Taxes: Trustpower 'Very Disappointed' With Judgement

Trustpower is "very disappointed" with a Supreme Court ruling dismissing its bid to claim tax deductions on $17.7 million of project costs in a case closely watched by large-scale infrastructure developers. More>>

ALSO:

Fruitful Endeavours: Kiwifruit Exports Reach Record Levels

In June 2016, kiwifruit exports rose $105 million (47 percent) from June 2015 to reach $331 million, Statistics New Zealand said today. Overall, goods exports rose $109 million (2.6 percent) in June 2016 (to $4.3 billion). More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news