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

 


NZ dollar edges up as producer prices hint at inflation

NZ dollar edges up after producer prices foreshadow building inflation pressures

By Paul McBeth

May 19 (BusinessDesk) - The New Zealand dollar edged up in local trading after government figures showed producer prices rose faster than expected, pointing to potential inflationary pressures.

The kiwi rose to 86.33 US cents at 5pm in Wellington from 86.27 cents at 8am, and 86.21 cents on Friday in New York. The trade-weighted index was little changed at 80.26 from 80.18 yesterday.

New Zealand producers faced a 1 percent increase in input prices in the first three months of the year, due to a jump in electricity prices, according to Statistics New Zealand. That was twice the pace investors were expecting, and is seen as a leading indicator of inflation. The Reserve Bank started hiking interest rates in March to head off the threat of looming consumer price rises.

“The PPI (producers price index) was a little bit higher than expected and pulled the kiwi up of its lows,” said Michael Johnston, senior dealer at HiFX in Auckland. “The kiwi will fall in the medium term, but in the short-term it’s pretty well-bid with New Zealand interest rates attractive relative to elsewhere.”

A BusinessDesk survey of 11 traders and strategists predicts the local currency may trade between 85 US cents and 87.40 cents this week. Six predict the kiwi will remain neutral this week, while two pick it to increase and three say it may decline.

HiFX’s Johnston said the GlobalDairyTrade auction on Tuesday in the US will be interesting after prices slumped this year, heightening speculation the forecast payout to Fonterra Cooperative Group’s farmer shareholders will be cut from a record $8.65 per kilogram of milk solids.

The minutes to the Reserve Bank of Australia’s May policy review will be watched tomorrow, with traders gauging the strength of the Australian economy. The kiwi increased to 92.28 Australian cents at 5pm in Wellington from 92.05 cents on Friday in New York.

The local currency gained to 87.61 yen from 87.52 last week, and edged up to 63 euro cents from 62.94 cents. It was little changed at 51.31 British pence from 51.26 pence.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

BusinessDesk: APN's NZME Sees Future In Paywalls, Growth In Digital Sales

APN News & Media has touted a single newsroom concept for its NZME unit in New Zealand, similar to what Germany's Die Welt uses, saying an 'integrated sales proposition' is helping it win market share, including ... More>>

Labour Party: Global Milk Prices Now Lowest In 6 Years

The latest fall in the global dairy price has brought it to the lowest level in six years and shows there must be meaningful action in tomorrow’s Budget to diversify the economy, says Labour’s Finance spokesperson Grant Robertson. “Dairy prices ... More>>

BusinessDesk: NZ Inflation Expectations Creep Higher In June Survey

May 19 (BusinessDesk) - New Zealand businesses lifted their expectations for inflation over the next two years, sapping any immediate pressure on the Reserve Bank to cut interest rates, and prompting the kiwi dollar to jump higher. More>>

BusinessDesk: Lower Fuel Costs Drive Down NZ Producer Input, Output Prices

May 19 - Producer input and output prices fell in the first quarter, mainly reflecting lower fuel costs and weakness in prices of meat and dairy products. More>>

Media: Fairfax Media NZ Announces Senior Editorial Team

Fairfax Media New Zealand has today confirmed its new editorial leadership team, as part of a transformation of its newsrooms aimed at enhancing local and national journalism across digital and print. More>>

Science: Flavonoids Reduce Cold And Cough Risk

Flavonoids reduce cold and cough risk Research from the University of Auckland shows eating flavonoids – found in green tea, apples, blueberries, cocoa, red wine and onions – can significantly reduce the risk of catching colds and coughs. The research, ... More>>


BusinessDesk: RBNZ House Alert Speech The Catalyst For Government Action

Prime Minister John Key all but conceded that pressure from the Reserve Bank of New Zealand for concerted action on rampant Auckland house prices was one of the main catalysts for the government's weekend announcements about tightly ... More>>

BusinessDesk: How To Fall Foul Of The New Housing Tax Rules: Tips From IRD

Just because you rented out your investment property doesn't absolve you from paying tax, says the Inland Revenue Department in a summary of commonly made mistakes by non-professional property investors when it comes to their tax liability.More>>

Legal: Superdiversity Law, Policy And Business Stocktake Announced

Mai Chen, Managing Partner at Chen Palmer New Zealand Public and Employment Law Specialists and Adjunct Professor of Law at the University of Auckland, today announced the establishment ... More>>

Housing: More House Price Gains Expected

House price expectations remain high, with a net 56% of respondents expecting house prices will increase. Fears of higher interest rates are fading, consistent with the RBNZ’s signals this year. Affordability and a lack of houses for ... More>>

TDDA: State-Of-The-Art Drug Testing Laboratory To Open In Auckland

World leading drug testing agencies, The Drug Detection Agency (TDDA) and Omega Laboratories, open New Zealand laboratory More>>

Network: Bigpipe Launches Ultra-Fast Broadband Into Wellington

Bigpipe Launches Ultra-Fast Broadband into Wellington Naked broadband provider Bigpipe has extended its national reach, announcing today, the launch of its unlimited UFB offering into Wellington. The Spark Venture business is giving Wellingtonians the ... More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news