NZ dollar advances as sentiment improves on prospect of economic revival
By Tina Morrison
Aug 15 (BusinessDesk) – The New Zealand dollar rose as sentiment was buoyed by reports showing a revival in the local economy, which is likely to push up interest rates and increase the lure of the currency.
The kiwi rose to 80.31 US cents, from 79.82 cents at the 5pm market close yesterday. The trade-weighted index gained to 75.73 from 75.36.
The New Zealand dollar is being supported by economic data which points to a reviving local economy. Figures yesterday showed retail sales grew at a 4.2 percent annual pace in the second quarter and reports today are expected to show broad strength in the nation’s manufacturing sector and strong consumer confidence, assisted by low interest rates and a buoyant housing sector.
“The New Zealand dollar was the strongest performer amongst its key peers over the past 24 hours,” Kymberly Martin, markets strategist at Bank of New Zealand, said in a note. “Both data (today) should confirm the relative strength of the New Zealand economy provides firm underpinning for the New Zealand dollar.”
Today’s releases include ANZ Job Advertisements for July at 10am, manufacturing for July at 10:30am and the ANZ-Roy Morgan Consumer Confidence survey for August at 1pm.
Tonight, the focus for currency markets should shift back to the US, with the Empire manufacturing survey, industrial production, inflation, the NAHB house market index, the Philadelphia Fed business survey and weekly jobless claims helping to shape direction, Carrick Lucas, a strategist at ANZ New Zealand, said in a note.
The kiwi increased to 87.91 Australian cents at 8am in Wellington from 87.75 cents yesterday and advanced to 78.76 yen from 78.29 yen. The local currency rose to 60.58 euro cents from 60.19 cents yesterday and edged up to 51.79 British pence from 51.69 yesterday.