NZ dollar falls as ECB halts loans to Greek banks   17 May 2012

Hannah Lynch

The New Zealand dollar fell to a five-month low after the European Central Bank said it will temporarily stop lending to Greece's banks, damping investors' appetite for risk-sensitive assets.

The New Zealand dollar fell as low as 76.20 US cents in Northern Hemisphere trading from 76.48 cents yesterday. It traded at 76.30 cents just before 8am. The trade weighted index slipped to 69.33 from 69.47.

Investor nerves remained fragile after Europe's central bank said it will put a temporary hold on lending to some Greek banks to limit its risk in response to the Mediterranean nation's inability to elect a government. ECB President Mario Draghi signalled the bank won't compromise on its key principals just to keep Greece in the euro, and acknowledged for the first time that Greece could leave the euro. The bank has no new plans for policy action and is instead waiting to see the outcome of the next election.

"You have to be cautious of these kinds of headlines because they are still just making the market jump," said Rebecca Orlowitz, analyst at Commonwealth Bank of Australia in New York. "The kiwi has just slowed back down - we expected 78.60 US cents to cap the topside but I think we are looking to go below 76.20 cents before we see some buyers."

Greece’s three main political parties have been unable to reach an agreement since elections on May 6. The nation will probably return to the ballot box on June 17. This date is yet to be confirmed.

"Until we see these elections it kind of just a call for 'what's your view?'" Orlowitz said.

US Federal Reserve policy makers said extra stimulus may be needed to help boost the world's largest economy if growth slows or there is elevated risk, according to the minutes from the Federal Open Market Committee's April meeting.

Earlier this year the Fed reaffirmed its pledge to keep interest rates near zero until at least the end of 2014.

Investors will be eyeing the sale of French and Spanish government bonds on Thursday to see if the region's debt crisis is continuing to worsen. It will be the first French auction since Francois Hollande defeated Nicolas Sarkozy as president.

In New Zealand, ANZ Job Advertisements for April and March's Producer Price Index from Statistics New Zealand will be released today.

The New Zealand dollar fell to 60.06 euro cents from 60.21 cents yesterday and declined to 77.04 Australian cents from 77.23 cents. The kiwi was little changed at 47.89 British pence from 47.94 pence yesterday and was largely unchanged at 61.27 yen from 60.21 yen.

(BusinessDesk)

Add a comment

Bookmark and Share

News

15,000 fewer people dependent on benefits

17 Apr 2014 News
New Zealand Government 15,000 fewer people dependent on benefits Social Development Minister Paula Bennett says the latest benefit ... more

Govt to establish Food Safety Science & Research Centre

16 Apr 2014 News
  Science and Innovation Minister Steven Joyce and Food Safety Minister Nikki Kaye today announced that expressions of interest... more

Business

Air NZ says claims withdrawn as other airlines settle in Oz

17 Apr 2014 Business News
Article - BusinessDesk   Air New Zealand says claims withdrawn as other airlines settle over cargo cartel, seeks costs April 17 ... more

Genesis Energy soars on debut, other gen-taliers rise

17 Apr 2014 Business News By Suze Metherell
  Genesis Energy soars on debut, leading fellow energy companies higher April 17 (BusinessDesk) – Shares in the partially... more

Living

The Taite Music Prize: IMNZ announces this years winner

17 Apr 2014 Entertainment
The winner of the fourth annual Taite Music Prize 2013 is Lorde for her album ‘Pure Heroine’ released on Universal Music... more

3 Mile Limit Movie Continues to Win Awards in the U.S

15 Apr 2014 Lifestyle
New Zealand movie ‘3 Mile Limit’ has won Best Feature Film at both the North Hollywood and Charleston International Film... more

Property

NZ house values rise at slowest annual pace in 6 months in March, QV says

7 Apr 2014 Property
April 7 (BusinessDesk) – New Zealand property values increased at the slowest annual pace in six months in March as lower... more

Auckland landlords lead in capital gains

28 Mar 2014 Property
Three-bedroom houses in Glen Innes giving an annual capital gain of 18.9%, followed by New Windsor. Auckland landlords are making... more

Migration

New working holiday agreement between New Zealand and Croatia launched

28 Mar 2014 Migration
Citizens of Croatia aged between 18 and 30 will soon be eligible to apply for a New Zealand Working Holiday Visa, giving them the... more

New Zealand immigration hits ten year high

28 Mar 2014 Migration
New statistics have shown net migration to New Zealand to be at a 10 year high, with China becoming the largest source of new... more

Travel

Chinese company to build $200M hotel on Auckland waterfront

16 Apr 2014 Travel & Tourism By Suze Metherell
  Company linked to one of China’s richest women to spend $200 mln on Auckland hotel April 16 (BusinessDesk) – Fu... more

SmartGate opens to arriving UK & US travellers

3 Apr 2014 Travel & Tourism
Customs Minister Maurice Williamson today announced SmartGate is now open to United Kingdom and American travellers on arrival. The... more

Sport

Dan Carter: All Blacks's goal is back-to-back World Cups

17 Apr 2014 Rugby By Oliver Brown
New Zealand No 10 is loving his sabbatical, including a trip to the Masters, however his only motive is to return fit and fresh for... more

Seeds March to Quarters at Skycity NZ Badminton Open

17 Apr 2014 Sport
TOP SEEDS CONTINUE MARCH TO QUARTER FINALS AT SKYCITY NZ BADMINTON OPEN Top seeds dominated in this morning’s 3rd round... more

Columns

Gordon Campbell: drone strikes & Judith Collins‘ last stand

17 Apr 2014 Opinion
Reportedly, US drone operators refer to their kills as "bug splat” - mainly because when the carnage is viewed on their... more

Gordon Campbell on the life & ACC work of Sir Owen Woodhouse

16 Apr 2014 Opinion
With the death of Sir Owen Woodhouse, the founding father of the Accident Compensation Scheme, New Zealand has lost one of the... more

Kiwi Success

BNZ names Anthony Healy as new CEO, replacing Thorburn

17 Apr 2014 Appointments
April 17 (BusinessDesk) – Bank of New Zealand, the local unit of Australia’s third-biggest mortgage lender, named the... more

Kiwi alpinist is finalist for prestigious award

26 Mar 2014 People
NZ Alpine Club Kiwi alpinist is finalist for prestigious mountaineering award New Zealand Alpine Club President John Cocks has today... more

Recruitment

Growth seen further lifting average wage by $7,500

15 Apr 2014 Recruitment
  The average annual wage is expected to increase by $7,500 to around $62,200 a year by 2018 if New Zealand achieves its ... more

NZ employment confidence lifts in 1st-qtr

31 Mar 2014 Recruitment
Article - BusinessDesk   NZ employment confidence lifts in 1st-qtr, current job opportunities seen less negative March 31 ... more