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

 

NZ dollar headed for 1.6% weekly slide

NZ dollar headed for 1.6% weekly slide; speculation mounts on central bank cut

By Jenny Ruth

July 26 (BusinessDesk) - The New Zealand dollar looks set to end the week more than a US cent lower amid speculation as to which central bank will cut first and by how much.

The kiwi was trading at 66.53 US cents at 5pm in Wellington from 66.57 cents at 8am and 67.61 cents in New York last Friday. The trade-weighted index was at 73.05 points from 73.08.

On Thursday, the European Central Bank signalled a rate cut in September while the Federal Reserve is expected to cut its key Fed funds rate by 25 basis points next week; market pricing indicates an outside chance of a 50-point cut.

The Reserve Bank of New Zealand is expected to cut its official cash rate in August from the record low 1.5 percent reached after its last cut in May, while its Australian counterpart is expected to cut its cash rate again in October after cutting it by 25 points in both June and July to its current record low at 1 percent.

“It’s all very much central bank driven – that’s pretty much the tale of all exchange rates at the moment,” says Imre Speizer, strategist at Westpac.

Westpac is predicting the RBNZ will also cut rates in November with an outside chance of a cut in September as well, Speizer says.

Although the latest round of jitters was sparked by a speech by RBA governor Philip Lowe yesterday in which he said his central bank is poised to cut rates if necessary, the impact was greater on the kiwi than the Aussie simply because the RBNZ is expected to cut again sooner.

Speculation is also growing that the Bank of Japan may cut rates soon.

The New Zealand dollar was trading at 95.81 Australian cents from 95.80, at 53.45 British pence from 53.48, at 59.68 euro cents from 59.74, at 72.26 yen from 72.38 and at 4.5763 Chinese yuan from 4.5743.

The New Zealand two-year swap rate eased to 1.2430 percent from 1.2613 yesterday while the 10-year swap rate fell to 1.6600 percent from 1.6900.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Up 0.5% In June Quarter: Services Lead GDP Growth

“Service industries, which represent about two-thirds of the economy, were the main contributor to GDP growth in the quarter, rising 0.7 percent off the back of a subdued result in the March 2019 quarter.” More>>

ALSO:

Pickers: Letter To Immigration Minister From Early Harvesting Growers

A group of horticultural growers are frustrated by many months of inaction by the Minister who has failed to announce additional immigrant workers from overseas will be allowed into New Zealand to assist with harvesting early stage crops such as asparagus and strawberries. More>>

ALSO:

Non-Giant Fossil Disoveries: Scientists Discover One Of World’s Oldest Bird Species

At 62 million-years-old, the newly-discovered Protodontopteryx ruthae, is one of the oldest named bird species in the world. It lived in New Zealand soon after the dinosaurs died out. More>>

Rural Employers Keen, Migrants Iffy: Employment Visa Changes Announced

“We are committed to ensuring that businesses are able to get the workers they need to fill critical skills shortages, while encouraging employers and regions to work together on long term workforce planning including supporting New Zealanders with the training they need to fill the gaps,” says Iain Lees-Galloway. More>>

ALSO:

Marsden Pipeline Rupture: Report Calls For Supply Improvements, Backs Digger Blame

The report makes several recommendations on how the sector can better prevent, prepare for, respond to, and recover from an incident. In particular, we consider it essential that government and industry work together to put in place and regularly practise sector-wide response plans, to improve the response to any future incident… More>>

ALSO: