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


NZ dollar falls as Fed stimulus expectations wane

NZ dollar falls as Fed stimulus expectations wane on better US data, euro optimism

By Hannah Lynch

Aug. 20 (BusinessDesk) - The New Zealand dollar fell after signs of life in the US economy sapped expectations for more monetary stimulus and as investors struggled to decipher clues about Europe's plans to tackle its debt-crisis.

The New Zealand dollar fell to 80.65 US cents at 8am from 80.72 cents at the close of trading in New York on Friday and 80.91 from 5pm on Friday. The kiwi decreased to 65.31 euro cents from 65.35 cents at the close of New York trading and 65.55 cents on Friday. The trade weighted index declined to 72.89 from 72.99.

Upbeat consumer confidence on Friday added to the string of better-than-expected US data, which has eroded speculation the Federal Reserve will increase its monetary stimulus. Investors are preparing for the latest minutes from the Federal Open Market Committee meeting on Wednesday. Traders are reluctant to change their bets before the Fed's next summit in Jackson Hole, Wyoming at the end of August.

"Any change in QE3 will be reflected in the kiwi/US cross," said Stuart Ive, currency strategist at HiFX. "Data out of the US on Friday indicated that it may be turning to the positive side reducing the expectation of QE3."

The euro extend gains on optimism policymakers are closer to finding a solution for the debt crisis, even as German Finance Minister Wolfgang Schaeuble ruled out another aid programme for Greece. German, Greek and French policymakers are all set to meet later this week.

"There is a definite Euro-wide decision to make to this thing succeed," Ive said. "They just have to decide on a line of thought."

Ive said the New Zealand dollar is likely to trade in a range of between 80.30 US cents to 81.40 cents finishing the week higher on "the basis that we see positive overtones coming out from the Europeans."

In New Zealand, the BNZ-Business NZ Performance of Services Index for July will be released this morning. The series' sister survey, the manufacturing index, slipped into contraction in July, falling to its lowest level in three-months.

The New Zealand dollar was little changed at 77.37 Australian cents from 77.33 cents at the close of trading in New York. The kiwi was largely unchanged at 51.38 British pence from 51.35 pence. It relatively unchanged at 64.19 yen from 64.12.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Auckland Transport: Successful Bridge Repair Opens Two Additional Lanes To Traffic

The opening of two additional lanes on the Auckland Harbour Bridge this morning will help relieve some motorway congestion for motorists heading home to the North Shore tonight. More>>


Statistics New Zealand: COVID-19 Sees Record 12.2 Percent Fall In New Zealand’s Economy

Gross domestic product (GDP) fell by 12.2 percent in the June 2020 quarter, the largest quarterly fall recorded since the current series began in 1987, as the COVID-19 restrictions in place through the quarter impacted economic activity, Stats NZ said ... More>>


Climate: Scientists Release ‘Blueprint’ To Save Critical Ecosystems And Stabilize The Earth’s Climate

A group of scientists and experts produced the first comprehensive global-scale analysis of terrestrial areas essential for biodiversity and climate resilience, totaling 50.4% of the Earth's land. The report was published in Science Advances ... More>>


MPI: Independent Review Launched Into Assurances For Safe Transport Of Livestock By Sea

The Ministry for Primary Industries (MPI) has launched an independent review of the assurances it receives for the safe transport of livestock by sea. MPI Director-General Ray Smith says Mike Heron QC has been appointed to lead the review, which is expected ... More>>


Computers: New Zealand PC Market Grows Nearly 40% Due To Work From Home Demand

COVID-19 had large impacts on demand for PCs as businesses prepared for lockdowns by purchasing notebooks to mobilise their workforce. In the second quarter of 2020, New Zealand's Traditional PC market experienced a 39.7% year-on-year (YoY) growth ... More>>


University Of Auckland: Whale-Watching By Satellite – Follow Their Travels Online

Scientists have successfully attached satellite tracking tags to six New Zealand southern right whales, or tohorā, and are inviting the public to follow the whales’ travels online. Part of a major research project involving the University of Auckland ... More>>

Commerce Commission: Kiwibank Admits System Failures And Agrees To Pay Customers $5.2 Million

Kiwibank has entered into a settlement agreement with the Commerce Commission after reporting that it failed to have in place robust home loan variation disclosure policies, procedures and systems. In a settlement dated 27 August 2020, Kiwibank admitted that ... More>>

Ministry of Health: Public Transport Distancing Requirements Relaxed

Physical distancing requirements on public transport have been reviewed by the Ministry of Health to determine whether they are still required at Alert Level 2 (or below). The Ministry’s assessment is that mandatory face covering and individuals tracking ... More>>


NZHIA: New Zealand Hemp Industry Set To Generate $2 Billion Per Annum And Create 20,000 Jobs

A new report says a fully enabled hemp industry could generate $2 billion in income for New Zealand by 2030, while also creating thousands of new jobs. Written by industry strategist Dr Nick Marsh, the report has prompted calls from the New Zealand Hemp ... More>>


Stats NZ: One In 14 Employed People Report High Risk Of Losing Jobs

About one in 14 workers say they expect to lose their job or business by mid-2021, Stats NZ said today. A survey of employed people in the June 2020 quarter showed 7 percent felt there was a high or almost certain chance of losing their job or business ... More>>

ASB Quarterly Economic Forecast: NZ Economy Doing Better Than Expected, But Challenges Remain

August lockdown estimated to have shaved 8% off NZ’s weekly GDP, and 0.5% off annual GDP Economy now expected to shrink 5% (year-on-year) by end of 2020 Unemployment rate now expected to peak at 7.2% The latest ASB Quarterly Economic Forecast is less ... More>>