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

 

Dollar falls as fears over bank stocks weigh on US equities

Friday 30 September 2016 08:42 AM

NZ dollar falls as fears over bank stocks weigh on US equities

By Paul McBeth

Sept. 30 (BusinessDesk) - The New Zealand dollar followed stocks on Wall Street lower as several hedge funds scaled back their business with Deutsche Bank, triggering fears the US Department of Justice's US$14 billion claim against the financial institution could have wider implications for the sector.

The kiwi fell to 72.56 US cents at 8am in Wellington from 72.90 cents yesterday. The trade-weighted index declined to 77.06 from 77.26.

The Dow Jones Industrial Average fell 1 percent as financial stocks including Goldman Sachs declined after Bloomberg reported a number of funds that clear derivatives trades with Deutsche Bank withdrew some excess cash and positions held with the lender, a sign of counterparties’ mounting concerns about doing business with Europe’s largest investment bank. The US justice department proposed settlement against Deutsche Bank over an investigation into residential mortgage-backed securities is almost as much as the bank's market value.

The Chicago Options Board Exchange's Volatility Index, known as Wall Street's fear gauge, spiked 17 percent to 14.45, and risk-sensitive currencies such as the Australian, kiwi, and Canadian dollars fell.

"A risk-off tone developed just after 5:30 this morning when reports came through of some counterparties that deal with Deutsche Bank withdrawing some excess cash and positions held at the bank, a reflection of DB’s perceived credit risk," Bank of New Zealand currency strategist Jason Wong said in a note. "This has seen commodity currencies lose some ground and support for safe-haven currencies."

Commodity-linked currencies got a boost yesterday when oil prices rose on an announcement by the Organisation of the Petroleum Exporting Countries that they would reduce production, but have since retraced those gains. The kiwi increased to 94.96 Australian cents from 94.75 cents yesterday.

Local data today include August building consents at 10.45am.

The local currency fell to 4.8368 Chinese yuan from 4.8658 yuan yesterday and declined to 73.34 yen from 73.95 yen. It dropped to 64.65 euro cents from 65 cents and was little changed at 55.92 British pence from 56.02 pence.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

RNZ: Porirua Most Expensive Region To Rent, According To Trade Me

A rental website shows this town is now New Zealand's most expensive region to rent a house, ahead of Wellington and Auckland cities. More>>

ALSO:


Stats NZ: Nearly 1,000 More Big Businesses Now Than Two Decades Ago – Media Release

There are now 2,690 big businesses in New Zealand employing more than 100 staff – nearly 1,000 or 58 percent more than 20 years ago, Stats NZ said today. Over the 20 years to February 2020, the total number of enterprises in New Zealand increased ... More>>

ALSO:

RNZ: Housing Boom Could Get Worse, Economist Warns

Economists are calling on the Reserve Bank to reinstate lending restrictions, warning the housing market is spiralling out of control. More>>

ALSO:

Westpac: Sets Out Plan To Go Cheque-Free

Westpac NZ has announced details of its plan to phase out cheques, after signalling in May that it would be supporting a move to other forms of payment. Cheques will cease to be available as a means of payment after 25 June 2021. Westpac NZ General ... More>>

ALSO:

NZTA: Major New Zealand Upgrade Programme Projects Go To Tender

Two major New Zealand Upgrade Programme projects are beginning tenders for construction. The New Zealand Upgrade Programme is a $6.8 billion investment to get our cities moving, to save lives and boost productivity in growth areas. The first Auckland ... More>>

Reserve Bank: RBNZ Seeks To Preserve Benefits Of Cash

The Reserve Bank – Te Pūtea Matua is taking on a new role of steward of the cash system “to preserve the benefits of cash for all who need them”, Assistant Governor Christian Hawkesby told the Royal Numismatics Society of New Zealand annual conference ... More>>

ALSO:


CERT NZ: Malicious Computer Virus Targeting New Zealanders

CERT NZ, the government agency which supports organisations and individuals affected by cyber security incidents, says a recent surge of increasingly sophisticated malware attacks is affecting everyday New Zealanders as well as large organisations. The ... More>>

ALSO:

Economy: NZ Small Business Recovery Continues In September

Xero, the global small business platform, today released its Small Business Insights (XSBI) for September revealing an uptick in small business jobs and year-on-year revenue growth in New Zealand. Nationwide, the average number of jobs in the small ... More>>

ALSO:


Courts: Businessman Eric Watson Sentenced To A Four-Month Jail Term

New Zealand businessman Eric Watson has been sentenced to a four-month jail term in the UK for contempt of court, TVNZ reports. More>>

OECD: Area Employment Rate Falls By 4.0 Percentage Points, To 64.6% In Second Quarter Of 2020

The OECD area employment rate – the share of the working-age population with jobs – fell by 4.0 percentage points, to 64.6%, in the second quarter of 2020, its lowest level since the fourth quarter of 2010. Across the OECD area, 560 million persons ... More>>

Spark: Turns On 5G In Auckland And Offers A Glimpse Into The Future Of Smart Cities

Spark turned on 5G in downtown Auckland today and has partnered with Auckland Transport (AT) to showcase some of the latest in IoT (Internet of Things) technology and demonstrate what the future could look like for Auckland’s CBD with the power of 5G. 5G is ... More>>

Stats NZ: Monthly Migration Remains Low

Since the border closed in late-March 2020, net migration has averaged about 300 a month, Stats NZ said today. In the five months from April to August 2020, overall net migration was provisionally estimated at 1,700. This was made up of a net gain ... More>>