NZ dollar gains vs. euro on shrinking German economy, Fitch   12 Jan 2012

Hannah Lynch

The New Zealand dollar was the biggest gainer among the world’s 10 most-traded currencies and set a new high against the euro as the Germany economy shrank and Fitch Ratings urged the European Central Bank to do more to tackle the region’s debt woes.

The New Zealand dollar recently traded at 62.60 euro cents and earlier reached 62.67 cents, the highest since the common currency was released in 2002, up from 62.24 cents at 5pm yesterday. The kiwi rose to 79.57 US cents from 79.31 cents.

The Germany economy shrank 0.25 percent in the fourth quarter from the third, after growing 3 percent last year, according to the Federal Statistics Office in Wiesbaden. The European Union also lowered euro-area growth to 0.1 percent in the third quarter, from a 0.2 percent estimated earlier, stoking investor concerns the crisis will worsen.

“The New Zealand dollar remains relatively attractive,” said Alex Sinton, senior deal at ANZ New Zealand. “You can’t bank on the exchange rate moving a certain way – but around this time of year we do tend to have a kick up in the kiwi.”

Fitch urged the European Central Bank to boost bond purchases to combat the debt crisis to help prevent the collapse of the shared currency. The ECB is expected to keep its key interest rate at 1 percent at a policy meeting tomorrow, according to the median estimate of 53 economists’ survey by Bloomberg.

A Reuters poll of economists forecast the worst is yet to come in the euro zone's debt crisis, though they expect the currency union to survive 2012 intact. Nine out of the poll's 64 economists said the bloc had turned the corner on a sovereign debt crisis, only 10 said the euro zone would not survive the year in its current form. The rest were reasonably confident it would.

A string of upbeat US data underpinned the US dollar’s strength, the Federal Reserve’s so-called Beige Book, a report on regional economic conditions, improved across all regions in the final six weeks of 2011, boosted by strong holiday sales and employment figures, housing remains stagnant.

In New Zealand, the ANZ Commodity Price Index is set for release at 1pm, providing an update of prices for the nation’s exports of raw materials.

The kiwi was up 77.20 Australian cents from 77.09 cents yesterday, it traded at 51.91 British pence from 51.30 pence and 61.14 yen from 60.90 yen.

The trade-weighted index rose to 71.34 from 71.04.

(BusinessDesk)

Add a comment

Bookmark and Share

News

Pharmac increases access to new treatments

5 Dec 2016 Health
Jonathan Coleman 5 December, 2016 Pharmac increases access to new treatments Health Minister Jonathan Coleman we... more

Prime Minister John Key announces resignation

5 Dec 2016 Ministerial Speeches
Rt Hon. John Key 5 December, 2016 Just a few days ago I marked the anniversary of my eighth year as Prime Minister and my... more

Business

Treasury forecasts solid growth, stable finances

8 Dec 2016 Business News
8 December, 2016 Treasury forecasts solid growth, stable finances Treasury’s latest forecasts show the Government... more

Key crowns APEC summit with China free-trade upgrade

21 Nov 2016 Business News By Pattrick Smellie
Article - BusinessDesk Monday 21 November 2016 08:50 AM Key crowns APEC summit with China free-trade upgrade By Pattrick Smellie in ... more

Living

3rd Position, Louis Vuitton America’s Cup World Series

21 Nov 2016 Lifestyle
Emirates Team New Zealand EMIRATES TEAM NEW ZEALAND CLOSES IN 3rd POSITION THE LOUIS VUITTON AMERICA’S CUP WORLD SERIES more

Arts Foundation Award recipients for 2016

14 Nov 2016 Lifestyle
The Arts Foundation Next generation of internationally acclaimed talent among the Arts Foundation Award recipients for 2016Under ... more

Property

NZ house prices gain 11% in October

14 Nov 2016 Property
Article - BusinessDesk Monday 14 November 2016 10:28 AM NZ house prices gain 11% in October, driven by sales of higher value homes By... more

RBNZ sees pressures building in Auckland construction sector

11 Nov 2016 Property By Paul McBeth
Article - BusinessDesk Thursday 10 November 2016 04:04 PM RBNZ sees pressures building in Auckland construction sector By Paul ... more

Migration

Good progress on investment attraction strategy

8 Dec 2016 Migration
Economic Development Minister Steven Joyce has welcomed news that New Zealand is attracting a higher level of quality international... more

Changes to Financial Markets Conduct Act impact UK pension transfers

1 Nov 2016 Migration
New Zealand Government Hon Paul GoldsmithMinister of Commerce and Consumer Affairs 1 November 2016 Changes to Financial Markets... more

Travel

Work on $700m Puhoi road underway

8 Dec 2016 Travel & Tourism
Hon. Simon Bridges 8 December, 2016 Prime Minister John Key and Transport Minister Simon Bridges have turned the sod on th... more

Air NZ teams up Ronan Keating, Julian Dennison for Christmas song

2 Dec 2016 Travel & Tourism
Air New Zealand has paired up with singer Ronan Keating and rising Kiwi actor Julian Dennison to rejig a Christmas classic. 'Summer... more

Sport

BLACKCAPS lose Chappell-Hadlee trophy

8 Dec 2016 Cricket
BLACKCAPS lose Chappell-Hadlee trophy Posted Tuesday, 6 December, 2016 

more

Columns

Gordon Campbell on the Gareth Morgan crusade

11 Nov 2016 Opinion
Column - Gordon Campbell   Gordon Campbell on the Gareth Morgan crusade First published on Werewolf more

Gordon Campbell on the US election outcome

10 Nov 2016 Opinion
Column - Gordon Campbell   Gordon Campbell on the US election outcome more

Kiwi Success

High Commissioner to India announced

8 Dec 2016 Appointments
Hon. Murray McCully 7 December, 2016 High Commissioner to India announced Foreign Minister Murray McCully today... more

Acting District Court Judge appointed

11 Nov 2016 Appointments
New Zealand Government Hon Christopher FinlaysonAttorney-General 11 November 2016 Acting District Court Judge appointed Wellington... more

Recruitment

NZ Government accepts recommendations on pay equity

8 Dec 2016 Recruitment
Hon. Paula Bennett,  Hon. Michael Woodhouse, Hon. Louise Upston 24 November, 2016 The Government will update the Equa... more

Fisher Funds hunts for new head to replace founder

2 Nov 2016 Recruitment
Article - BusinessDesk Tuesday 01 November 2016 04:42 PM Fisher Funds hunts for new head to replace founder Carmel Fisher By Paul ... more

s