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

 


NZ dollar little changed, eschews risk aversion

NZ dollar little changed as yield advantage offsets risk aversion

By Paul McBeth

Aug. 11 (BusinessDesk) - The New Zealand dollar was little changed as the currency's relatively attractive yield helped underpin the currency in the face of heightened risk aversion among investors.

The kiwi traded at 84.67 US cents at 5pm in Wellington from 84.60 cents at 8am, and 84.56 cents on Friday in New York. The trade-weighted index edged up to 79.39 from 79.27 last week.

New Zealand's currency has been a favourite among investors this year after a series of interest rate increases boosted its yield advantage over its peers. The yield on 10-year New Zealand government bonds was recently at 4.25 percent, compared to 2.44 percent on 10-year US Treasuries or 1.05 percent on European government bonds. That advantage has limited the kiwi's 3.9 percent decline over the past month as falling commodity prices and heightened geopolitical tensions sap investors' appetite for risk-sensitive assets.

"The kiwi seems to be somewhat immune to risk aversion," said Sam Tuck, senior FX strategist at ANZ Bank New Zealand in Auckland. "It points to the long-term yield advantage of New Zealand."

ANZ's Tuck said he expects the kiwi will eventually grind lower as the US economic recovery gathers pace, and stokes demand for the greenback.

New Zealand government figures today showed retail spending on electronic cards rose in July after a survey last month showed increased consumer confidence.

A BusinessDesk survey of eight traders and strategists predicts the kiwi will probably trade between 83 US cents and 86 cents this week. Four expect the kiwi will remain largely unchanged this week, while three said it may gain and one is picking a drop.

The local currency gained to 86.48 yen at 5pm in Wellington from 86.29 yen on Friday in New York, and increased to 91.22 Australian cents form 91.12 cents. It edged up to 63.18 euro cents from 63.05 cents last week, and was little changed at 50.44 British pence from 50.41 pence.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news