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

 


New Zealand dollar falls on US rate hike speculation

New Zealand dollar falls on US rate hike speculation

By Suze Metherell

July 7 (BusinessDesk) - The New Zealand dollar fell after last week's strong US employment data stoked market speculation the Federal Reserve will move to hike interest rates sooner than expected.

The kiwi was 87.18 US cents at 5pm in Wellington, from 87.38 cents at New York close and 87.49 cents at 5pm on Friday. The trade-weighted index fell to 81.21, a five-day low, from 81.30 at the New York close.

The US dollar strengthened after US Labor Department figures on Thursday showed 288,000 jobs were added in June, exceeding the 215,000 the market was expecting, while unemployment dropped to 6.1 percent from 6.3 percent in May. The accelerating recovery of the world's biggest economy has fuelled expectations among traders that Fed chair Janet Yellen will hike interest rates sooner than anticipated.

"Until that payrolls number came out the sense was that the Fed was likely to maintain interest rates at a very low level, and have an extended period of low interest rates," said Garry Dean, a trader at CMC Markets. "The market is feeling that the pressure is going to start to come on Janet Yellen, she might need to satisfy the market and start looking at bringing forward interest rate rises, which is why, of course, the US dollar has begun to rise."

Minutes for the June meeting of the Federal Reserve are scheduled to be published on Wednesday in Washington, giving the market more insight into the policymaker's outlook.

A BusinessDesk survey of 10 traders and strategists predicts the kiwi may trade between 86.40 US cents and 88.50 cents this week. Six predict the kiwi will fall this week, while two expect it to gain and two say it will likely remain largely unchanged.

"The market is following on from that payroll data, we saw the US dollar close the week on bid tone and that's really followed through and traders are wondering if early on the week we might just get a continuation of that US dollar strength," CMC's Dean said. The kiwi was currently supported at 87 US cents, he said.

The New Zealand dollar edged lower to 93.14 Australian cents at 5pm in Wellington, from 93.21 cents at New York close. CMC's Dean said Thursday employment figures across the Tasman are likely to move the Australian dollar.

The local currency dropped to 89.01 yen, from 89.21 at the New York close and was little changed at 50.85 British pence, from 50.92 pence last week. The kiwi slipped to 64.18 Euro cents, from 64.26 cents.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Media: Julian Wilcox Leaves Māori TV

Māori Television has confirmed the resignation of Head of News and Production Julian Wilcox. Mr Maxwell acknowledged Mr Wilcox’s significant contribution to Māori Television since joining the organisation in 2004. More>>

ALSO:

Genetics: New Heat Tolerant Cow Developed

Hamilton, New Zealand-based Dairy Solutionz Ltd has led an expert genetics team to develop a new dairy cow breed conditioned to thrive in lower elevation tropical climates and achieve high milk production under heat stress. More>>

Fractals: Thousands More Business Cards Needed To Build Giant Sponge

New Zealand is taking part in a global event this weekend to build a Menger Sponge using 15 million business cards but local organisers say they are thousands of business cards short. More>>

Scoop Business: NZ Net Migration Rises To Annual Record In September

New Zealand’s annual net migration rose to a record in September, beating government forecasts, as the inflow was spurred by student arrivals from India and Kiwis returning home from Australia. More>>

ALSO:

Scoop Business: Fletcher To Close Its Christchurch Insulation Plant, Cut 29 Jobs

Fletcher Building, New Zealand’s largest listed company, will close its Christchurch insulation factory, as it consolidates its Tasman Insulations operations in a “highly competitive market”. More>>

ALSO:

Scoop Business: Novartis Adds Nine New Treatments Under Pharmac Deal

Novartis New Zealand, the local unit of the global pharmaceuticals firm, has added nine new treatments in a far-ranging agreement with government drug buying agency, Pharmac. More>>

ALSO:

Crown Accounts: English Wary On Tax Take, Could Threaten Surplus

Finance Minister Bill English is warning the tax take may come in below forecast in the current financial year, as figures released today confirm it was short by nearly $1 billion in the year to June 30 and English warned of the potential impact of slumping receipts from agricultural exports. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand

Mosh Social Media
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news