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

 

R18: The Warehouse Group Praised For Removing Games

The decision by New Zealand’s largest retailer The Warehouse Group (TW Group), to withdraw stocks of the latest version of Grand Theft Auto V (GTA V) and other R18 games, has been praised by advocacy group Stop Demand Foundation. More>>

ALSO:

Air NZ Wine Awards: Victory For Villa Maria As Pinot Noir Thrills

It was a night to remember as Villa Maria Estate picked up one of the highest accolades of the evening, the O-I New Zealand Reserve Wine of the Show Trophy, at the 28th Air New Zealand Wine Awards. The Villa Maria Single Vineyard Southern Clays Marlborough ... More>>

ALSO:

Future Brighter Money: RBNZ Releases New Bank Note Designs

New Zealand’s banknotes are getting brighter and better, with the Reserve Bank today unveiling more vibrant and secure banknote designs which will progressively enter circulation later next year. More>>

ALSO:

Commerce: Supermarket Inquiry Finds No Breaches By Countdown

The Commerce Commission inquiry into anti-competitive behaviour by Countdown supermarkets, alleged by former Labour Party MP Shane Jones, has found nothing to warrant prosecution, although it warns supermarkets to take care in the way they communicate... More>>

ALSO:

Crown Accounts: English Flags ‘Challenge’ To Budget Surplus

Finance Minister Bill English is warning next month’s half yearly fiscal and economic update from the Treasury may not forecast a budget surplus, saying that returning the government’s accounts to surplus in 2015 will be “a challenge”, given the decline in commodity prices and weak global inflation. More>>

ALSO:

March 2015: Netflix To Launch In Australia And New Zealand

World’s Leading Internet Television Network to Offer Original Series, Movies, Documentaries, Stand-Up Comedy Specials and TV Shows for Low Monthly Price More>>

ALSO:

Price Of Cheese (Is Up): Dairy Product Prices Fall To Five-Year Low

Dairy product prices fell in the latest GlobalDairyTrade auction to the lowest level in more than five years, led by declines in rennet casein and skim milk powder. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news