News | Business
20 Feb 2018 14:40
NZCity News
NZCity CalculatorReturn to NZCity

  • Start Page
  • Personalise
  • News
  • Sport
  • Weather
  • Shopping
  • Jobs
  • Horoscopes
  • Lotto Results
  • Photo Gallery
  • Site Gallery
  • TVNow
  • Dating
  • SearchNZ
  • NZSearch
  • Crime.co.nz
  • RugbyLeague
  • Make Home
  • About NZCity
  • Contact NZCity
  • Your Privacy
  • Advertising
  • Login
  • Join for Free

  •   Home > News > Business

    NZ dollar off early highs but range-bound

    The New Zealand dollar was off its highs after some comments from a central bank deputy governor and ahead of Tuesday's second-quarter domestic inflation data.

    17 July 2017

    The New Zealand dollar was off its highs after some comments from the Reserve Bank and ahead of Tuesday's second-quarter domestic inflation data.

    The kiwi traded at US73.30c US cents as at 5pm in Wellington versus 73.42 US cents as at 8am and US73.45c in late New York trading on Friday.

    It got a solid lift overnight Friday from weak US inflation, retail sales and consumer sentiment figure but ground lower over the session.

    The trade-weighted index was at 77.97 from around 78.11 late Friday.

    "It's still range-bound but it's off its highs," ANZ senior economist Phil Borkin said.

    Some early risk aversion in Asian equity markets coupled with comments from Reserve Bank deputy governor Geoff Bascand took some of the shine off, he said.

    Bascand said a large improvement in New Zealand's net foreign liabilities as a share of gross domestic product makes the economy less vulnerable to shocks.

    He said one "striking feature" of the improvement is that it has occurred despite the real exchange rate being high over much of the period.

    Typically a higher exchange rate would contribute to widening the current account deficit but "the improvement in the NFL-GDP suggests that the exchange rate might be more sustainable than previously assumed," he said.

    In some ways that was an acknowledgement, the currency needs to be where it is but he added the caveat that from a growth point of view, a lower exchange rate would help rebalance growth towards the tradables sector, Mr Borkin said.

    "The kiwi was already under some pressure and that helped it along its way."

    However, he said the main event risk for the currency is Tuesday's domestic inflation data.

    Economists expect inflation was 0.2 per cent in the three months ended June 30, for an annual rate of 1.9 per cent, according to the median in a poll of 15 economists surveyed by Bloomberg.

    That would be below the central bank's projection of inflation of 0.3 per cent in the second quarter for an annual rise of 2.1 per cent.

    "Any surprise will see a bit of currency volatility, but I'd be surprised if it pushes on too much unless its a really significant surprise," Mr Borkin said .

    The kiwi slipped to 63.93 euro cents from 64.06 cents in New York on Friday and traded at 82.53 yen from 82.67 yen.

    It fell to 4.9615 yuan from 4.9756 yuan and traded at 55.97 British pence from 56.11 pence.

    The kiwi traded at A93.81c from A93.75c.

    New Zealand's two-year swap rate fell 3 basis points to 2.23 while the 10-year swaps fell 2 basis points to 3.33 per cent.

    © 2018 NZN, NZCity


     Other Business News
     20 Feb: Fonterra likely to hike milk payment: OMF
     20 Feb: Weak greenback hitting beef exports to US
     20 Feb: Vista increases stake in China
     20 Feb: Reverse mortgages boost Heartland Bank
     20 Feb: Kiwi down in subdued trading
     20 Feb: FMA turning torch on rogue directors
     19 Feb: Freightways' new addition on budget
     Top Stories

    RUGBY RUGBY
    McKenzie ready for playmaking pressure More...


    BUSINESS BUSINESS
    Fonterra likely to hike milk payment: OMF More...



     Today's News

    Education:
    Florida shooting: Students stage 'lie-in' to pressure White House on gun control 14:35

    Environment:
    'We're waiting for the winds': Faafoi 14:35

    Entertainment:
    Jennifer Aniston’s dislike for New York City contributed to her split from Justin Theroux 14:35

    Law and Order:
    Racer guilty of manslaughter 14:15

    Politics:
    Government set to release TPP text 14:05

    Entertainment:
    Lionel Richie thinks his daughter Sofia’s romance with Scott Disick is a “phase” 14:05

    Law and Order:
    Teen beach photographer in Supreme Court 13:55

    Business:
    Fonterra likely to hike milk payment: OMF 13:45

    Entertainment:
    Jennifer Lawrence wants to dedicate her time to getting young people involved in politics 13:35

    Hockey:
    Argentina challenge awaits Black Sticks 13:15


     News Search






    Power Search


    © 2018 New Zealand City Ltd