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


NZ dollar edges up as investors look for Fed to print money

NZ dollar edges up as investors look for Fed to print more money

By Paul McBeth

Sept. 10 (BusinessDesk) - The New Zealand dollar rose through the local trading session as investors get set for the US Federal Reserve to print more money when its reviews monetary policy later this week after weak jobs growth spurs it to action.

The kiwi gained to 81.16 US cents at 5pm in Wellington from 81.03 cents at 8am and was little changed from 81.21 cents at the close of trading in New York last week. The trade-weighted index inched up to 72.51 from 72.40 last week.

Traders are leaning towards an expectation Fed chairman Ben Bernanke will unveil a third round of quantitative easing and push out the timeline for near-zero interest rates this week when the Federal Open Market Committee reviews monetary policy. That's supported demand for so-called risk sensitive assets, such as the trans-Tasman currencies, on the prospect the Fed's action will devalue the greenback.

"The kiwi will probably creep a little higher towards the first half of the week going into the Fed meeting," said Peter Dragicevich, FX economist at Commonwealth Bank of Australia in Sydney. "There's a risk the market could be somewhat disappointed" if the Fed's asset purchase programme is for mortgage-backed securities, which would see "the US dollar lift afterwards," he said.

Four of five analysts surveyed by BusinessDesk expect the kiwi will gain this week as the Fed decision looms and the Reserve of New Zealand reviews local monetary policy.

Outgoing governor Alan Bollard is tipped to leave the official cash rate at 2.5 percent in his final monetary policy statement, extending its longest stint without moving.

Chinese imports fell 2.6 percent and its exports gained 2.7 percent, leaving the world's second biggest economy with a trade surplus of US$26 billion last month from a year earlier, according to official figures today.

Dragicevich said the import data showed underlying demand for iron ore has persisted, and the Chinese economy "might not be slowing as much as people feared."

The New Zealand dollar rose to 63.50 euro cents from 63.36 cents at the close of trading in New York, and advanced to 50.76 British pence from 50.67 pence. It was little changed at 63.50 yen from 63.55 yen last week, and increased to 78.38 Australian cents from 78.14 cents.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Barfoot and Thompson: Auckland Housing Prices Shrug Off Winter Concerns

Auckland house prices shrugged off the normal winter downturn, concerns about increasing prices and warnings of possible future interest rate rises in July.
“Mounting concerns about the prices being paid and possible future interest rate increases did nothing to dampen July trading... More>>

Stats NZ: Sharp Falls In Unemployment And Underutilisation

The seasonally adjusted unemployment and underutilisation rates fell to 4.0 and 10.5 percent, respectively, in the June 2021 quarter, Stats NZ said today. The unemployment rate continued to fall from its recent peak of 5.3 percent in the September 2020 quarter... More>>

FIRST Union: Do Shareholders Realise Marsden Point Conversion Could Cost More Than Half A Billion Dollars?

FIRST Union, the union representing workers at Refining NZ, are querying whether shareholders voting on Friday on whether to convert the Marsden Point refinery to an import-only terminal realise the conversion could cost $650-700 million dollars... More>>

Transport: July 2021 New Vehicle Registrations Boosted By EV Rebate Scheme
Motor Industry Association Chief Executive David Crawford says that July 2021 sales of new vehicles were boosted by the recently introduced rebate scheme. July 2021 registrations were 15,053 units compared to 12,263 units for July 2020... More>>

ASB: New Support Finder Tool Helps Connect Customers With Thousands In Government Support

ASB research alongside benefit numbers from the Ministry of Social Development shows an increased number of Kiwis are struggling financially, and many may not be aware they’re eligible for government support... More>>

Housing: New Home Consents Continue To Break Records

A record 44,299 new homes were consented in the year ended June 2021, Stats NZ said today. “The annual number of new homes consented rose again in the June 2021 year, the fourth consecutive month of rises,” construction statistics manager Michael Heslop said... More>>