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

 


NZ dollar slips below 83 US cents on fall in dairy prices

NZ dollar slips below 83 US cents on fall in dairy prices, upbeat US data

By Tina Morrison

Sep. 3 (BusinessDesk) - The New Zealand dollar dipped below 83 US cents for the first time since February as manufacturing data pointing to a recovery in the US strengthened the greenback while a decline in dairy prices at Fonterra Cooperative Group's latest auction weighed on the kiwi.

The local currency touched a low of 82.89 US cents, and was trading at 83.14 cents at 8am in Wellington, from 83.46 cents at 5pm yesterday. The trade-weighted index was at 78.79 from 79.02 yesterday.

The US dollar index, which measures the greenback against a basket of currencies, rose to its highest since July last year on optimism about a recovery in the world's largest economy after the Institute for Supply Management's US manufacturing activity index rose more than expected in August to its strongest level since March 2011. Meanwhile demand for kiwi waned after dairy product prices dropped to the lowest level since July 2012 in Fonterra's latest GlobalDairyTrade auction. Dairy products are New Zealand's largest commodity export.

"The US dollar was strong because of strong data, and milk prices fell," said Westpac Banking Corp New Zealand senior market strategist Imre Speizer. The kiwi is "under downward pressure still," he said.

The local currency has declined from a high of 88.35 US cents in July, weighed down by falling commodity prices, slower economic growth forecasts and a pause in the Reserve Bank's hiking cycle.

The next major support level is 82.45 US cents, Westpac's Speizer said.

Today, New Zealand data is released on second quarter building work at 10:45am.

However traders will likely be focused on Australia, where data is published on second quarter gross domestic product and Australian Reserve Bank governor Glenn Stevens is scheduled to speak to the Committee for Economic Development of Australia at a luncheon in Adelaide, which is open to the media.

The Reserve Bank of Australia yesterday kept the cash rate unchanged at 2.5 percent and said a "period of stability" in interest rates was warranted given the outlook for inflation. Stevens said the Australian dollar "remains above most estimates of its fundamental value," especially given the decline in commodity prices.

The kiwi declined to 89.60 Australian cents from 89.79 cents yesterday, slipped to 63.32 euro cents from 63.61 cents and was little changed at 87.41 yen from 87.44 yen.

The local currency advanced to 50.47 British pence from 50.33 pence yesterday after a poll showed support for Scottish independence had increased ahead of a referendum in two weeks that could see Scotland split from the rest of the UK.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Maritime: Navigation Safety Review Raises Big Issues For The Govt

Shipping Federation: "The reports makes it clear that the ratification of the Maritime Labour convention (MLC) is long overdue. Only when the MLC is ratified will Maritime NZ be able to inspect and enforce the labour conditions on international ships visiting our ports." More>>

ALSO:

100 Years After Einstein Prediction: Gravitational Waves Found

For the first time, scientists have observed ripples in the fabric of spacetime called gravitational waves, arriving at the earth from a cataclysmic event in the distant universe. This confirms a major prediction of Albert Einstein’s 1915 general theory of relativity and opens an unprecedented new window onto the cosmos. More>>

ALSO:

Farming: Alliance Plans To Start Docking Farmer Payments

Alliance Group, New Zealand's second-largest meat cooperative, plans to start withholding some stock payments to its farmers from next week to bolster its balance sheet and force suppliers to meet their share requirements. More>>

ALSO:

Gambling: SkyCity First Half Profit Rises 30%, Helped By High Rollers

SkyCity anticipates the Auckland business will benefit from government gaming concessions which were triggered on Nov. 11 in recognition of SkyCity’s $470 million Convention Centre development. Morrison said the concessions would allow the Auckland business to lift its activity during peak period, noting it had a record revenue week over the Christmas and New Year period. More>>

ALSO:

Money For Light: Kiwi Scientists Secure Preferential Access To Synchrotron

Science and Innovation Minister Steven Joyce today announced a three-year investment of $2.8 million in the Australian Synchrotron, the largest piece of scientific infrastructure in the Southern Hemisphere, to secure preferential access for Kiwi scientists. More>>

Telco Industry Report: Investment Hits $1.7 Bln A Year

Investment in the telecommunications sector is $1.7 billion a year, proportionately one of the highest levels in the OECD, according to a report released today on the status of the New Zealand sector. More>>

ALSO:

PGPs: New Programme Sets Sights On Strong Wool

A new collaboration between The New Zealand Merino Company (NZM) and the Ministry for Primary Industries (MPI), announced today, aims to deliver premiums for New Zealand's strong wool sector... More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news