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


NZ dollar little changed near 17-month low

NZ dollar little changed near 17-month low on TWI basis ahead of employment data

By Jonathan Underhill

Nov. 1 (BusinessDesk) - The New Zealand dollar was little changed, holding near a 17-month low on a trade-weighted basis before employment data that may point to an uptick in inflation.

The kiwi traded at 68.42 US cents as at 8am in Wellington from 68.45 cents late yesterday. The trade-weighted index was at 72.62 and earlier touched 72.51, the lowest since the end of May last year, from 72.61 yesterday.

The kiwi dollar sank yesterday after reports showed business confidence turned negative in October and building permits fell in September, while Prime Minister Jacinda Ardern announced a ban on foreigners buying existing homes in New Zealand starting early next year. The currency has retreated since the new coalition government was formed but may get a boost today with employment figures expected to show rising wage pressures, adding to the case for the Reserve Bank to begin projecting higher interest rates in its monetary policy statement next week.

"The data was further fuel for those looking for reasons to sell the NZD as we’ve consistently seen since the election," said Jason Wong, currency strategist at Bank of New Zealand, in a note. Today's employment data "will help set the tone for next week’s RBNZ MPS, which already also has to consider the weaker NZD, higher oil prices, a much higher minimum wage track over coming years, much easier fiscal policy and the higher starting point for inflation."

The unemployment rate probably fell to 4.7 percent from 4.8 percent in the third quarter while employment grew 0.8 percent and private sector ordinary-time wages - which have shown only tepid increases in recent years - grew 0.7 percent from 0.4 percent in the second quarter.

In its August MPS, the Reserve Bank forecast third-quarter inflation of 0.2 percent for an annual rate of 1.6 percent but changes since then include a TWI that's 7.5 percent lower than the 78.5 average level it projected for the third quarter, a change that heralds a return to imported inflation. The next MPS is published on Nov. 9.

The kiwi fell to 51.48 British pence from 51.84 pence and traded at 58.71 euro cents from 58.83 cents. It rose to 89.30 Australian cents from 89.15 cents, traded at 4.5382 yuan from 4.5359 yuan and gained to 77.76 yen from 77.47 yen.



© Scoop Media

Business Headlines | Sci-Tech Headlines


Stats NZ: Consents For New Homes At All-Time High

A record 41,028 new homes have been consented in the year ended March 2021, Stats NZ said today. The previous record for the annual number of new homes consented was 40,025 in the year ended February 1974. “Within 10 years the number of new homes ... More>>

Stats NZ: Unemployment Declines As Underutilisation Rises

The seasonally adjusted unemployment rate decreased to 4.7 percent in the March 2021 quarter, continuing to fall from its recent peak of 5.2 percent in the September 2020 quarter but remaining high compared with recent years, Stats NZ said today. ... More>>


Digitl: The Story Behind Vodafone’s FibreX Court Ruling

Vodafone’s FibreX service was in the news this week. What is the story behind the Fair Trading Act court case? More>>

Reserve Bank: Concerned About New Zealand's Rising House Prices

New Zealand house prices have risen significantly in the past 12 months. This has raised concerns at the Reserve Bank of New Zealand – Te Putea Matua about the risk this poses to financial stability. Central banks responded swiftly to the global ... More>>

Westpac: Announces Strong Financial Result

Westpac New Zealand (Westpac NZ) [i] says a strong half-year financial result has been driven by better than expected economic conditions. Chief Executive David McLean said while the global COVID-19 pandemic was far from over, the financial effect on ... More>>

MYOB: SME Confidence In Economic Performance Still Cautious

New insights from the annual MYOB Business Monitor have shown the SME sector is still cautious about the potential for further economic recovery, with two-in-five (41%) expecting the New Zealand economy to decline this year. The latest research ... More>>