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

 


NZ dollar falls as dairy prices extend decline

NZ dollar falls as dairy prices extend decline

By Suze Metherell

July 2 (BusinessDesk) - The New Zealand dollar declined as dairy prices fell to their lowest in 18 months at Fonterra Cooperative Group's latest GlobalDairyTrade auction, raising concerns about the strength of the local economy.

The kiwi slipped to 87.52 US cents at 5pm in Wellington, from 87.71 cents at 8am and 87.67 at 5pm yesterday. The trade-weighted index edged lower to 81.14 from 81.25 yesterday.

The trade-weighted GDT price index fell 4.9 percent to US$3,595 a tonne, its ninth decline in the last 10 auctions and its lowest level since January 2013, while today's ANZ commodity price index declined for the fourth straight month in June, down 0.9 percent from last month and is now 6.7 percent below its February peak. Dairy is the nation's biggest export, making up 30 percent of New Zealand's annual exports. The lower dairy prices and elevated currency prompted the ANZ economists to downgrade their forecast for the 2015 payout to farmers, which they said would reduce dairy incomes by $3 billion in the season.

"New Zealand has high terms of trade, where our commodity prices are high and our currency is high, so we're selling our goods at their highest possible price," said Martin Rudings, senior dealer at OMF. "When the commodity prices slip there's an idea, or a reasoning, that the economy is not going to do as well so we're not going to earn as much and the currency doesn't deserve to be where it is."

The kiwi fell to 92.57 Australian cents from 92.75 cents yesterday, extending a decline after the Reserve Bank of Australia took a softer tone on the strength of its currency than analysts had been expecting. The Australian currency pared some of those gains after government data today showed a bigger than expected trade deficit.

"We had some weak Aussie data which turned the Aussie lower," OMF's Rudings said.

The kiwi slipped to 51.03 British pence at 5pm in Wellington from 51.24 pence yesterday. The local currency was little changed at 88.91 yen from 88.92 yen yesterday and 64 euro cents from 64.05 cents.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Final Frontier: Rocket Lab And NASA Sign Commercial Space Launch Agreement

Rocket Lab has signed a Commercial Space Launch Act Agreement with the National Aeronautics and Space Administration (NASA). The agreement enables Rocket Lab to use NASA resources - including personnel, facilities and equipment - for launch and reentry efforts. More>>

ALSO:

Scoop Business: Wheeler Downplays Scope For ‘Large’ Rates Fall

Reserve Bank governor Graeme Wheeler says some market commentators are predicting further declines in interest rates that would only make sense for an economy in recession, although some easing is likely to be needed to maintain New Zealand’s economic growth. More>>

ALSO:

Ruataniwha Dam: Consent Conditions Could Mean Reduced Intensity

Legal advice sought by the Hawke’s Bay Regional Council on the Ruataniwha Dam consent conditions has confirmed that farmers who sign up to take water from the dam could be required to reduce the intensity of their farming operation to meet the catchment’s strict nitrogen limit. More>>

Health And Safety: Bill Now Sees Rules Relaxed For Small Businesses

Health and safety law reform sparked by the Pike River coalmine disaster has been reported back from the industrial relations select committee with weakened requirements on small businesses to appoint health and safety representatives and committees. More>>

ALSO:

Bearing Fruit: Annual Fruit Exports Hit $2 Billion For First Time

The value of fruit exported rose 20 percent (up $330 million) for the June 2015 year when compared with the year ended June 2014. Both higher prices and a greater quantity of exports (up 9.0 percent) contributed to the overall rise. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news