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

 

NZ dollar gains on concern weak US housing may slow tapering

NZ dollar strengthens on concern weak US housing market may delay Fed tapering

By Tina Morrison

Aug. 26 (BusinessDesk) – The New Zealand dollar advanced after weaker than expected US housing sales data raised concerns the Federal Reserve may not start tapering its monetary stimulus next month.

The kiwi rose to 78.11 US cents at 8am in Wellington from 77.99 cents at the New York close and 78.30 cents on Friday. The trade-weighted index slipped to 73.62 from 73.99 on Friday.

The US dollar index, which measures the greenback against a basket of currencies, fell sharply after a report showed new home sales in the US dropped more than expected in July and the data for the previous three months was revised downwards. That raised concerns about the strength of the US economy and the likelihood that the Fed will start to pull back on its US$85 billion a month bond-buying programme as early as next month.

“The slump in sales, despite an apparent shortage of established dwellings on the market, could be a further sign that higher mortgage rates are nipping the nascent housing recovery in the bud,” Imre Speizer, Westpac Banking Corp senior currency strategist, said in a note. The report was “enough to jolt the market into reassessing the chances of Fed tapering starting in September.”

The US report showed new home sales plunged 13.4 percent in July, well below the expected 2 percent fall and at the lowest level since October 2012.

Tonight, traders will be eyeing a report on US durable goods orders for indications of a revival in the world’s largest economy.

In New Zealand, a report at 10:45am on the trade balance for July is forecast to show a small deficit but overall healthy export figures, according to ANZ New Zealand.

The kiwi is likely to trade between 77.60 US cents and 78.60 cents with reasonable demand under 78 cents, ANZ senior economist Sharon Zollner said in a note.

The New Zealand dollar fell to 86.30 Australian cents at 8am in Wellington, from 86.77 cents on Friday. The local currency declined to 76.90 yen from 77.54 yen on Friday and slipped to 58.34 euro cents from 58.66 cents. The kiwi weakened to 50.15 British pence from 50.23 pence as the UK markets are closed for the August Bank holiday today.

(BusinessDesk)

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Grey Power: Is Disappointed To Learn Of More Bank Closures

Many older people are being left without essential services because of cost cutting and the march of modern technology. It is now expected that most banking transactions can occur via the internet or telephone. Jan Pentecost, President of the Grey Power ... More>>

ALSO:

Economy: Supply Chain On Brink Of Overload Says National Road Carriers

The New Zealand supply chain is on the brink of overload and it looks like the upcoming peak imports season may push it over the edge says National Road Carriers Association (NRC) CEO David Aitken. “Worldwide supply chains are in disarray,” says Mr Aitken. ... More>>

Retail: Supermarkets Announced As Government’s Second Market Study

The Government has today launched a market study to ensure New Zealanders are paying a fair price for groceries. More>>

ALSO:

Statistics New Zealand: Retail Sales Recover In The September 2020 Quarter

Retail sales values recorded the largest September quarter rise since the series began in 1995, Stats NZ said today. Spending on major household items, vehicles, and groceries contributed to the strong 7.4 percent ($1.8 billion) rise in total ... More>>

Kea Aerospace: New Zealand Flies Into The Stratosphere

Development has started on a solar-powered, unmanned aircraft that can fly in the stratosphere continuously for months at a time. The zero-emission aircraft will carry a suite of imagery equipment that will be game-changing for many industries, vastly ... More>>

Stats NZ: Births And Deaths: Year Ended September 2020

Births and deaths releases provide statistics on the number of births and deaths registered in New Zealand, and selected fertility and mortality rates. Key facts For the year ended September 2020: 57,753 live births and 32,670 deaths ... More>>

ALSO:


Forest & Bird: Kākāpō Wins Bird Of The Year 2020

The nation has voted and Aotearoa New Zealand has a new Bird of the Year. New Zealand’s moss-colored flightless parrot has climbed to the top-spot for the second time in Forest & Bird’s annual Te Manu Rongonui o Te Tau/Bird of the Year competition. ... More>>