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

 

NZ dollar rises after CPI meets expectations; US dollar weak

NZ dollar rises after CPI meets expectations; US dollar weakens

By Jenny Ruth

July 16 (BusinessDesk) - The New Zealand dollar rose after inflation data came in bang on expectations, posing no impediment to the Reserve Bank cutting interest rates. Both the kiwi and Australian dollars were boosted by a weaker greenback as the latest US earnings season gets underway.

The kiwi was trading at 67.32 US cents at 5pm in Wellington from 67.21 at 7:55am. The trade-weighted index advanced to 73.50 points from 73.38.

The Consumers Price Index came in at 0.6 percent for the June quarter and 1.7 percent for the year ended June, below the 2 percent level the central bank targets.

“The CPI doesn’t have any real implication to sway people one way or the other,” says Imre Speizer, senior market strategist at Westpac.

Those expecting RBNZ to cut rates in August have no reason to change their view and likewise those who are predicting rates won’t be cut, Speizer says.

Minutes released today from the Reserve Bank of Australia’s last meeting on interest rates on July 2 said the bank will cut interest rates again, “if needed.”

The minutes explained why the RBA decided to cut its cash rate at that meeting. “Lower interest rates would provide more Australians with jobs and assist with achieving more assured progress towards the inflation target,” the minutes said.

The US Federal Reserve is also widely expected to cut rates but Speizer says that is already well and truly backed into market pricing.

He attributes the US dollar weakness to the first company results trickling through.

While results reported so far have been fine, “depressed expectations about earnings are keeping investors cautious,” he says.

The New Zealand dollar was at 95.65 Australian cents versus 95.45, at 53.78 British pence from 53.69, at 59.79 euro cents from 59.67, at 72.69 yen from 72.51, and at 4.6268 Chinese yuan from 4.6206.

The New Zealand two-year swap rate edged down to 1.3341 percent from 1.3582 yesterday while the 10-year swap rate fell to 1.8100 percent from 1.8600.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Bus-iness: Transdev To Acquire More Auckland And Wellington Operations

Transdev Australasia today announced that it has agreed terms to acquire two bus operations in Auckland and Wellington, reaching agreement with Souter Investments to purchase Howick and Eastern Buses and Mana Coach Services. More>>

ALSO:

Māui And Hector’s Dolphins: WWF/Industry Counter Offer On Threat Management Plan

Forest & Bird says WWF-NZ's plan for protecting Māui dolphins is based on testing unproven methods on a species that is almost extinct, and is urging the Government to reject the proposal. More>>

ALSO:

Industry Report: Growing Interactive Sector Wants Screen Grants

Introducing a coordinated plan that invests in emerging talent and allows interactive media to access existing screen industry programmes would create hundreds of hi-tech and creative industry jobs. More>>

ALSO:

Ground Rules: Government Moves To Protect Best Growing Land

“Continuing to grow food in the volumes and quality we have come to expect depends on the availability of land and the quality of the soil. Once productive land is built on, we can’t use it for food production, which is why we need to act now.” More>>

ALSO: