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

 


NZ dollar break below 90.50 Aust cts ahead of dairy auction

NZ dollar break below 90.50 Australian cts ahead of dairy auction

By Jonathan Underhill

Aug. 19 (BusinessDesk) - The New Zealand dollar fell below a key support level against the Australian dollar and weakened against the greenback as traders took advantage of weaker producer prices and government economic forecasts to sell the kiwi ahead of the latest dairy auction.

The New Zealand dollar fell as low as 90.28 Australian cents and was at 90.40 Australian cents at 5pm in Wellington, from 91.11 cents late yesterday. The kiwi fell to 84.45 US cents from 84.98 cents and still has a way to go to reach a support level of 84 cents.

Government figures today showed producer output prices fell 0.5 percent in the second quarter while input prices dropped 1 percent, mainly reflecting a decline in dairy prices. Meantime, the government trimmed its forecast for its 2015 budget surplus and reduced its projection for near-term economic growth, citing weaker commodity prices and a lower tax take. With everyone from the Treasury to the Reserve Bank citing the drop in dairy, there is extra focus on the GlobalDairyTrade auction overnight, after prices fell in 11 of the past 12 sales.

"There's a lot of focus on the dairy auction tonight," said Raiko Shareef, currency strategist at Bank of New Zealand. "The trend is still very strongly negative" and a further substantial decline could see the kiwi test its support level of 84 US cents, he said.

The kiwi has twice nudged below 90.50 Australian cents in the past three weeks, having failed to break through in early June. It was last lower in December last year.

"We have tested that three times without a convincing break lower," Shareef said. It fell today "as news just piled up in a fairly quiet trading day."

Among other indicators out today, the Reserve Bank's survey of expectations showed businesses have trimmed their expectations for both inflation and economic growth over the next two years. The central bank has signalled a pause in its interest rate tightening cycle as it gauges the impact of increases in the official cash rate so far this year.

The trade-weighted index fell to 79.21 from 79.62 yesterday. It

The local currency traded at 86.66 yen from 86.92 yen yesterday, and fell to 63.22 euro cents from 63.42 cents. It traded at 50.51 British pence from 50.78 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