NZ dollar pares gains after Bernanke fails to signal QE3 8 Jun 2012
- MARKET CLOSE: NZ shares rise, led by Coats; Nuplex gains Business
- NZ dollar heads for 1.2% weekly decline Business
- NZ wool prices jump to multi-year high at auction Business
- UPDATE: Ryman posts 24% rise in FY profit on values gain Business
- NZ consumer confidence slips in May Business
- UPDATE: Comvita lifts FY profit 28% to record Business
- Hellaby buys auto parts, truck servicing businesses Business
- Gap between benefits and low waged workers had got too large Business
- Serko's annual loss widens, targets profitability in 2017 Business
- Ryman posts 24% profit gain on revaluations and sales rise Business
The New Zealand dollar fell from a one-month high after Federal Reserve Chairmen Ben Bernanke failed to signal further quantitative easing for the US, damping kiwi sentiment that had been lifted by China's unexpected interest cuts.
The New Zealand dollar fell to 76.65 US cents from 77.05 cents at 5pm yesterday. It rose as high as 77.52 US cents overnight, the highest since May 11 on speculation a Chinese rate cut will underpin the world’s fastest-growing major economy. The trade weighted index decreased to 69.90 from 70.07.
The New Zealand dollar rallied after China, New Zealand's second-largest export market, unexpectedly cut its interest rate to 0.25 percent, effective tomorrow. That's the first time the People's Bank of China has cut rates since 2008. Bernanke helped erase the kiwi's advances after signaling the world's largest economy remains at risk from Europe's debt crisis, even as he failed call to for consideration of additional stimulus.
"Broadly speaking the good cancelled out the bad leaving the New Zealand dollar where we were yesterday," said Mike Jones, market strategist at Bank of New Zealand. "Bernanke caused some late US dollar strength.”
Bernanke's comments were at odds with Fed Reserve Vice Chairman Janet Yellen's speech on Wednesday. Yellen said the US “remains vulnerable to setbacks” and may warrant more accommodation.
The Federal Open Market Committee will meet on June 19-20. Earlier this year the committee pledged to keep interest rates low until at least 2014.
The kiwi to fell to 77.53 Australian cents from 77.43 cents yesterday at 5pm after New Zealand's largest trading partner unexpectedly added 39,000 jobs in May. That comes just one day after Australia posted annual gross domestic product growth of 4.3 percent, beating economists' forecasts.
The Reserve Bank of Australia decision this week to cut the target cash rate a quarter point to 3.5 percent has also buoyed sentiment for Australia’s currency.
“For today, the NZD will continue to look across the Tasman for direction," Jones said.
Australian trade balance figures are set for release, while RBA Governor Glenn Stevens is scheduled to make a speech this afternoon.
In New Zealand, the March quarter’s wholesale trade survey will be release by Statistics New Zealand this morning.
The New Zealand dollar fell to 61.10 euro cents from 61.33 cents yesterday at 5pm. The kiwi dropped to 49.44 British pence from 49.81 pence and was little changed on 61.09 yen from 61.16 yen.
22 May 2015 News
22 May 2015 The Budget confirms $6.1 million in operating funding over the next four years and $13 million of capital funding from... more
22 May 2015 Business News
May 22 (BusinessDesk) - New Zealand consumer confidence slipped in May as sentiment about current and future conditions eased. The... more
25 Apr 2015 ANZAC
100 years after allied forces landed in Gallipoli, 25 April – ANZAC Day – has been commemorated in the UK officially for... more
24 Apr 2015 ANZAC
Tomorrow marks the 100th ANZAC Day, and if you are a Kiwi or Aussie far from home there are plenty of events on to enable you both to... more
22 May 2015 Property
Building and Housing Minister Dr Nick Smith today released at the Certified Builders’ Association conference in Christchurch... more
20 May 2015 Property
Goodman Property lifts FY earnings 5.4% on revenue growth, cost clamp down May 20 (BusinessDesk) - Goodman Property Trust,... more
30 Apr 2015 Migration
The Immigration Amendment Bill (No 2) which cracks down on employers who exploit migrant workers passed its final reading in... more
20 May 2015 NZ Tourism
Prime Minister and Tourism Minister John Key has today announced the Government is investing in two new tourism projects in... more
22 May 2015 Cricket
First innings at stumps on Day One: England 354-7 in 90 overs (Root 98, Stokes 92, Buttler 67, Ali 49*; Henry 3-93 on Test debut) DAY... more
22 May 2015 Opinion
From the outset, the slogan for yesterday’s Budget - “The Plan Is Working” – begged to be mocked.... more
30 Apr 2015 Opinion
For the past week or so we’ve been hearing a lot about the child-like side of our Prime Minister. So I guess we... more
15 May 2015 Appointments
Foreign Minister Murray McCully has today announced diplomat Sarah Walsh as New Zealand’s new High Commissioner to... more
15 May 2015 State of the Market Report
NZ's growing ICT sector drives rapid economic diversification, Joyce says May 15 (BusinessDesk) - New Zealand's information... more