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

 


NZ dollar gains from 3-mth low as traders regain confidence

NZ dollar gains from three-month low as traders regain confidence in local economy

By Paul McBeth

Jun. 5 (BusinessDesk) - The New Zealand dollar climbed from a three-month low as traders recovered lost confidence in the local economy, and lowered their expectations for a downgrade to the Reserve Bank's interest rate track when it reviews monetary policy next week.

The kiwi rose to,84.41 US cents at 5pm in Wellington from 84.15 cents at 8am and 84.13 cents yesterday. The trade-weighted index advanced to 78.90 from78.67 yesterday.

The New Zealand dollar arrested its slide this month as traders pared back expectations Reserve Bank governor Graeme Wheeler will lower his forecast track for interest rate hikes this year at next Thursday's monetary policy review. Traders started anticipating a slower pace of interest rate increases as dairy prices steadily declined this year, and local inflation stayed in check. Traders are betting Wheeler will hike the official cash rate 80 basis points over the coming 12 months, according to the Overnight Index Swap curve.

"The market is coming to their senses and realised they have overdone how much they think the Reserve Bank will downgrade the interest rate track next week," said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. "There was a very large gap that opened up between the Reserve Bank's latest forecast from March and where the market has priced it."

Investors will be watching the European Central Bank policy meeting on Thursday in Brussels, where president Mario Draghi is expected to announce new measures to stimulate the European economy. The kiwi gained to 62.04 euro cents at 5pm from 61.79 cents yesterday.

Westpac's Speizer said if Draghi delivers more stimulus, that should push interest rates lower and weigh on the kiwi dollar, which is seen as attractive because of New Zealand's relatively high rates, and if Draghi doesn't announce new measures, that will probably support the local currency.

The Bank of England also reviews monetary policy on Thursday in London, and is expected to keep rates unchanged. The kiwi edged up to 50.40 British pence from 50.29 pence yesterday.

Traders will be watching US employment figures on Friday in Washington for an update on the strength of the world's biggest economy after a private payrolls report missed expectations.

The kiwi increased to 90.90 Australian cents at 5pm in Wellington from 90.73 cents yesterday, and advanced to 86.56 yen from 86.35 yen.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Real Estate: Housing Prices Head South In Most Of NZ

Housing became more affordable for first home buyers in many parts of the country including Auckland last month, as falling prices more than offset rising mortgage interest rates. More>>

ALSO:

Cosmetics & Pollution: Proposal To Ban Microbeads

Cosmetic products containing microbeads will be banned under a proposal announced by the Minister for the Environment today. Marine scientists have been advocating for a ban on the microplastics, which have been found to quickly enter waterways and harm marine life. More>>

ALSO:

NIWA: 2016 New Zealand’s Warmest Year On Record

Annual temperatures were above average (0.51°C to 1.20°C above the annual average) throughout the country, with very few locations observing near average temperatures (within 0.5°C of the annual average) or lower. The year 2016 was the warmest on record for New Zealand, based on NIWA’s seven-station series which begins in 1909. More>>

ALSO:

Farewell 2016: NZ Economy Flies Through 2016's Political Curveballs

Dec. 23 (BusinessDesk) - New Zealand's economy batted away some curly political curveballs of 2016 to end the year on a high note, with its twin planks of a booming construction sector and rampant tourism soon to be joined by a resurgent dairy industry. More>>

ALSO:

NZ Economy: More Growth Than Expected In 3rd Qtr

Dec. 22 (BusinessDesk) - New Zealand's economy grew at a faster pace than expected in the September quarter as a booming construction sector continued to underpin activity, spilling over into related building services, and was bolstered by tourism and transport ... More>>

  • NZ Govt - Solid growth for NZ despite fragile world economy
  • NZ Council of Trade Unions - Government needs to ensure economy raises living standards
  • KiwiRail Goes Deisel: Cans electric trains on partially electrified North Island trunkline

    Dec. 21 (BusinessDesk) – KiwiRail, the state-owned rail and freight operator, said a small fleet of electric trains on New Zealand’s North Island would be phased out over the next two years and replaced with diesel locomotives. More>>

  • KiwiRail - KiwiRail announces fleet decision on North Island line
  • Greens - Ditching electric trains massive step backwards
  • Labour - Bill English turns ‘Think Big’ into ‘Think Backwards’
  • First Union - Train drivers condemn KiwiRail’s return to “dirty diesel”
  • NZ First - KiwiRail Going Backwards for Xmas
  • Get More From Scoop

     
     
     
     
     
     
     
     
    Business
    Search Scoop  
     
     
    Powered by Vodafone
    NZ independent news