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

 

NZ dollar heads for 2.5% monthly fall

NZ dollar heads for 2.5% monthly fall as bevy of central bank meetings loom in September

By Paul McBeth

Aug. 30 (BusinessDesk) - The New Zealand dollar is heading for a 2.5 percent fall in August, a month where emerging markets were heavily sold off, the country’s dairy industry was exposed to a false food scare, and investors speculated the Federal Reserve will start unwinding its money printing programme next month.

The kiwi traded 77.72 US cents at 5pm in Wellington from 77.73 cents at 8am, down from 78.32 cents yesterday. It started the week at 78.27 cents and ended July at 79.82 cents. The trade-weighted index fell to 73.69 from 74.01 yesterday, starting the week at 73.88. The TWI is heading for a 3.3 percent fall from 75.48 at the start of the month.

A BusinessDesk survey of 10 traders and strategists on Monday predicted the kiwi would trade between 76.40 US cents and 80.50 cents this week. Four predicted a decline, three picked a gain and three said it remain unchanged.

The kiwi was under pressure all month amid the growing expectations the Fed will start pulling back its stimulus, and a sell-off in emerging markets as developing economies start slowing and Fonterra Cooperative Group’s food scare added to the local currency’s woes. The prospect of a Western-led military strike on Syria in retaliation for attacking civilians with chemical weapons has also put markets on the back-foot.

Next month the kiwi will be at the whim of a raft of central bank meetings, kicking off on Tuesday with the Reserve Bank of Australia and culminating in the Federal Open Market Committee meeting on Sept. 18. The European Central Bank, Bank of England, Bank of Japan and Bank of Canada all review policy next week, and New Zealand’s Reserve Bank will release a monetary policy statement the following week.

“If we’re right and the Fed is going to be tapering in September, I think the US dollar will probably firm,” said Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney. The RBNZ’s meeting “will be the first set of forecasts since it indicated the (high) LVRs (lending restrictions), and there will be a bit more interest if they make a bit of difference to the MPS.”

The local currency fell to 86.91 Australian cents at 5pm in Wellington from 87.27 cents yesterday and declined to 76.40 yen from 76.57 yen. The kiwi edged down to 58.70 euro cents from 58.80 cents yesterday and fell to 50.10 British pence from 50.43 pence.

(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>>