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

 


NZ dollar extends drop vs. A$ after Australian CPI

NZ dollar extends drop vs. A$ after Australian inflation accelerates; RBNZ looms

By Paul McBeth

July 23 (BusinessDesk) - The New Zealand dollar extended its decline against its trans-Tasman counterpart after Australian government figures showed annual inflation accelerated to its fastest pace in four years, and ahead of the Reserve Bank of New Zealand's interest rate review tomorrow.

The kiwi fell to 91.97 Australian cents at 5pm in Wellington from 92.27 cents immediately before the report, and 92.36 cents yesterday. The local currency traded at 86.78 US cents at 5pm from 86.67 cents at 8am and 86.74 cents yesterday.

Australia's annual trimmed mean inflation rate increased to 2.9 percent in the June quarter, according to the Bureau of Statistics, and ahead of the 2.7 percent pace expected. The faster pace of consumer price increases reduces the likelihood of another rate cut by the Reserve Bank of Australia, and may diminish the yield advantage New Zealand has over its neighbouring nation.

"Aussie CPI was much stronger than expected," said Imre Speizer, market strategist at Westpac Banking Corp in Auckland. "We possibly may have seen the multi-year highs in that kiwi/Aussie cross."

The data comes ahead of tomorrow's monetary policy review by New Zealand's central bank. Governor Graeme Wheeler is expected to hike the official cash rate a quarter-point to 3.5 percent, the fourth increase since he embarked on tightening policy earlier this year in a bid to clamp down on inflationary pressures.

Westpac's Speizer said Wheeler will probably signal a pause in the tightening cycle at tomorrow's meeting, which might prompt some movement in the kiwi dollar, although "a lot of that is already priced in."

Finance Minister Bill English reiterated his view the kiwi is "unsustainably high" telling BusinessDesk on the sidelines of a Trans-Tasman Business Circle lunch in Wellington that "almost anyone who has looked at it comes to the conclusion it's somewhere 10 to 15 percent overvalued."

The trade-weighted index was little changed at 80.81 from 80.77 yesterday. The local currency gained to 64.45 euro cents at 5pm in Wellington from 64.13 cents yesterday, and traded at 50.82 British pence from 50.78 pence. It was little changed at 87.99 yen from 88.01 yen yesterday.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Scoop Business: Alex Swney Pleads Guilty To $2.5M Fraud Charge

Alex Swney, former chief executive of the Auckland city centre business association Heart of the City, has pleaded guilty to dishonestly using documents to obtain $2.5 million. More>>

ALSO:

Petrol Burns Prices: Second Consecutive Quarterly Fall For CPI

The consumers price index (CPI) fell 0.3 percent in the March 2015 quarter, following a 0.2 percent fall in the December 2014 quarter, Statistics New Zealand said today. The last time the CPI showed two consecutive quarterly falls was in the December 1998 and March 1999 quarters. More>>

ALSO:

Scoop Business: NZ Broadcasters Launch Battle Against Global Mode ISPs

New Zealand broadcasters have confirmed they’ve launched legal proceedings against internet service providers who give customers’ access to “global mode”, which allows customers access to offshore online content, claiming it breaches the local content providers’ copyright. More>>

ALSO:

Sanford: Closure Of Christchurch Mussel Processing Plant Confirmed

The decision comes after a period of consultation with the 232 staff employed at the Riccarton site, who were told on 9 April that Sanford was considering the future of mussel processing in Christchurch. Recent weather patterns had impacted on natural spat (offspring) supply... More>>

ALSO:

Price Of Cheese: Dairy Product Prices Fall To The Lowest This Year

Dairy product prices fell in the latest GlobalDairyTrade auction, hitting the lowest level in the 2015 auctions so far, as prices for milk powder and butter slid amid concern about the outlook for commodities. More>>

ALSO:

Houston, We Have An Air Route: Air New Zealand To Fly Direct To The Heart Of Texas

Air New Zealand will fly its completely refitted Boeing 777-200 aircraft between Auckland and Houston up to five times a week opening up the state of Texas as well as popular nearby tourist states such as Louisiana and Florida. More>>

ALSO:

Scoop Business: Reserve Bank’s Spencer Calls On Govt To Rethink Housing Tax

The Reserve Bank has urged the government to take another look at a capital gains tax on investment in housing, allow increased high-density development and cut red tape for planning consents to address an over-heated Auckland property market. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news