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

 

NZ dollar under pressure ahead of widely expected rate cut

By Rebecca Howard

Aug. 7 (BusinessDesk) - The New Zealand dollar remained under pressure after a soft dairy auction and ahead of the central bank’s rate decision.

The kiwi was trading at 65.28 US cents at 7:55 am in Wellington versus 65.29 cents at 5pm. The trade-weighted index was at 72.53 points from 72.54.

The New Zealand central bank is widely expected to cut rates by 25 basis points to a record low 1.25 percent as the global situation deteriorates and other central banks, like the US Federal Reserve, move to ease policy.

Weaker global dairy prices may have also weighed on the currency, with the GDT price down 2.6 percent. NZX dairy analyst Robert Gibson said, however, the slide is likely linked to a lift in the volume of product sold which was up nearly 40 percent on the previous event. This is fairly normal at this time of year as New Zealand milk supplies start to come online.

The US dollar also benefited from easing trade tensions when the People’s Bank of China on Tuesday set the daily currency fixing stronger than expected and said they don’t expect the yuan to weaken further.

“There’s a tentative risk-on theme,” said Kiwibank trader Mike Shirley.

However, the “kiwi unwound recent gains, despite a mild risk-on tone seeping back into markets as China looked to defuse trade tensions. A softer GDT auction was the main culprit, with whole milk powder prices falling sharply,” said ANZ Bank FX/rates strategist Sandeep Parekh.

The mood also lifted after US National Economic Council Director Larry Kudlow told CNBC that the US administration is still planning to host a Chinese delegation for talks in September.

The kiwi was trading at 96.55 Australian cents from 96.33 cents, slightly higher after the Reserve Bank of Australia yesterday held rates at a record low 1.0 percent but left the door open for more cuts.

“The board will continue to monitor developments in the labour market closely and ease monetary policy further if needed to support sustainable growth in the economy and the achievement of the inflation target over time,” governor Philip Lowe said in a statement.

The New Zealand dollar was at 53.65 British pence from 53.68, at 58.29 euro cents from 58.26, at 69.50 yen from 69.63 and at 4.5835 yuan from 4.5972.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

Energy Sector: Meridian Spilled Water To Hike Electricity Prices - Authority Ruling

The Electricity Authority has found that generator Meridian Energy manipulated the power market, costing consumers about $80 million. More>>

ALSO:

XE Data Update: RBNZ Official Cash Rate Decision

The RBNZ will keep the Official Cash Rate (OCR) at 0.25%. T he key points in the RBNZ statement are: RBNZ keeps the OCR unchanged at 0.25% Maintain the LSAP (large scale asset purchase) at NZD$60 billion. Committee prepared to use additional monetary ... More>>

ALSO:

Electricity: Kiwis Ignore Promise Of Cheaper Power

Electric Kiwi and Flick Electric Co are joint winners of Canstar Blue’s award for Most Satisfied Customers | Electricity Providers From putting on an extra layer – rather than turning on a heater – to turning off lights and choosing the energy-saving ... More>>

ALSO:

Economy: COVID-19 Contributes To 1.6 Percent Fall In March Quarter GDP

Gross domestic product (GDP) fell 1.6 percent in the March 2020 quarter, the largest drop in 29 years, as the initial effects of COVID-19 restrictions impacted on economic activity, Stats NZ said today. This quarter’s GDP results showed a widespread drop ... More>>

ALSO:


Electricity: Transmission Pricing For A Low Carbon Future

The Electricity Authority has decided on new guidelines for transmission pricing. James Stevenson-Wallace, Chief Executive of the Electricity Authority says the new guidelines will deliver significant benefits to consumers, through lower electricity ... More>>

ALSO:

ASB: Investor Confidence Falls To Four-Year Low

As the world grapples with the fallout from the most significant pandemic the world has seen in a century, economic concerns are weighing on investors, dragging investor confidence down to a four-year low in the first quarter of the year. For the three ... More>>

ALSO:

Science Media Centre: Funding For R&D In New Zealand – Expert Reaction

Research, Science and Innovation Minister Dr Megan Woods has today announced $401.3 million funding for research and development through Budget 2020 and the COVID Response and Recovery Fund. The fund includes $150 million for an R&D loan scheme, ... More>>

ALSO:


Science: 2019 Prime Minister’s Science Prizes Announced

The 2019 Prime Minister’s Science Prizes have been announced in a digital livestream event today. The Prizes recognise the impact of science on New Zealanders’ lives, celebrate the achievements of current scientists and encourage scientists of the ... More>>

ALSO:


RNZ: Fuel, Alcohol Costs To Go Up From Today

The increase today in the taxes on fuel, road user charges and alcohol is being called a tone-deaf move. More>>

ALSO:

Stardome Observatory: Young Kiwi Astro-Photographer Shoots For The Stars

Matariki by Josh Kirkley. The stars are aligning for up-and-coming Auckland-based astro-photographer Josh Kirkley (Kāi Tahu). During lockdown, one of his images was picked up by NASA and shared on the space agency’s Instagram to its 59.2 million ... More>>


DCANZ: Time For EU To Commit To A Level Playing Field For Trade

The Dairy Companies Association of New Zealand (DCANZ) has welcomed New Zealand Trade Minister David Parker’s statement that it is unacceptable for New Zealand exporters to continue facing an ‘unlevel playing field’ in the EU. Details leaked ... More>>

ALSO:

Potatoes New Zealand: Protecting NZ Fries As Part Of PNZ Pandemic Recovery & Transformation Plan

Potatoes New Zealand has met with Minister Faafoi this week to discuss investigating the potential importation of heavily discounted frozen potato chips into New Zealand. With MBIE’s support we are undertaking an investigation to gather evidence of the ... More>>

ALSO:


New Zealand Government: Supporting Kiwi Businesses To Resolve Rent Disputes

The Government will legislate to ensure businesses that suffered as a result of the COVID-19 response will get help to resolve disputes over commercial rent issues, Justice Minister Andrew Little announced today. More>>

ALSO:


Science Media Centre: Understanding 5G Concerns – Expert Q&A


Recent attacks on cell phone towers have brought concerns over the rollout of 5G technology into sharp relief.
While scientific research has consistently shown that the technology does not adversely affect human health, public concerns about its impact have spread around the world, fueled in part by growing misinformation online. The SMC asked experts to comment... More>>

ALSO:


Trade: Record Monthly Surplus As Imports Dive

Imports in April 2020 had their biggest fall since October 2009, resulting in a monthly trade surplus of $1.3 billion, Stats NZ said today. “This is the largest monthly trade surplus on record and the annual goods trade deficit is the lowest ... More>>

ALSO: