NZ dollar falls as investors mull lower rates; ECB looms 22 Jan 2015
Related articles
- NZ consumers grow more upbeat, may resume spending Business
- Knowles quits as CEO of KiwiBank Business
- NZ manufacturing activity reaches highest since 04 Business
- NZ home sales creep up in March, still subdued Property
- NZ economy expands at fastest pace in two years Business
- New Zealand food prices fall in February Business
- NZ hiring expectations up as recession fades Recruitment
- New Zealand’s net migrant inflow surges Migration
Article - BusinessDesk
NZ dollar falls as investors mull lower rates after Canadian cut; ECB looms
By Paul McBeth
Jan. 22 (BusinessDesk) - The New Zealand dollar dropped to a two-and-a-half year low as investors speculate the central bank may have to lower interest rates after the Bank of Canada surprised markets with a rate cut yesterday, and ahead of Europe's anticipated money printing programme.
The kiwi fell as low as 75.18 US cents, the lowest level since June 2012, and was trading at 75.25 cents at 5pm in Wellington from 75.66 cents at 8am and 76.58 cents yesterday. The trade-weighted index dropped to 77.08 from 78.15 yesterday.
Traders are pricing in 10 basis points of cuts to New Zealand's 3.5 percent official cash rate in the coming 12 months after Canada's central bank joined the growing number of monetary authorities moving to lower rates. That's heightened expectations Australia and New Zealand will need to follow as investors gear up for the European Central Bank's policy review today in Brussels, where the regulator is expected to unveil a major quantitative easing programme to help revive a sluggish regional economy.
"The Bank of Canada was obviously quite shocking, and puts the notion in people's minds that we may be about to witness the capitulation on the part of other central banks towards an easing bias," said Raiko Shareef, currency strategist at Bank of New Zealand in Wellington. "The pressure is on the kiwi and Aussie."
New Zealand interest rates fell in response to the Bank of Canada's quarter-point cut to its key rate to 0.75 percent, with shorter-dated rates dropping at a faster pace. The two-year swap rate fell to 3.61 at 5pm in Wellington from 3.65 yesterday, while the 10-year swap declined to 3.74 from 3.7675.
Upbeat local data today failed to support the kiwi, with manufacturing activity at a decade-high in December and consumer confidence remaining above its 10-year average this month.
BNZ's Shareef said the ECB decision will likely take a while for the market to digest, with the initial announcement followed by president Mario Draghi's press conference, and then greater investigation of the detail of the programme by investors after that.
The kiwi dropped to 64.87 euro cents at 5pm in Wellington from 66.19 cents yesterday, and declined to 49.70 British pence from 50.48 pence.
The local currency fell to 89.04 yen from 90.15 yen yesterday, and declined to 4.6740 Chinese yuan from 4.7609 yuan. It was little changed at 93.27 Australian cents from 93.28 cents yesterday.
(BusinessDesk)
News
Hilary Timmins' Award-Winning UK Documentary Series To Inspire NZ Students
29 Jun 2020 Education
Dream Catchers, produced and directed by Hilary Timmins, celebrates the success stories of more than thirty inspirational New... more
New Zealand reaffirms support for Flight MH17 judicial process
7 Mar 2020 News
Ahead of the start of the criminal trial in the Netherlands on 9 March, Foreign Minister Winston Peters has reaffirmed the need to... more
Business
NZ Government's Economic package to fight COVID-19
17 Mar 2020 Business News
The Coalition Government has launched the most significant peace-time economic plan in modern New Zealand history to cushion the... more
NZ Government announces aviation relief package
19 Mar 2020 Business News
Transport Minister Phil Twyford today outlined the first tranche of the $600 million aviation sector relief package announced earlier... more
Living
Diversity was Key at New Zealand Trade Tasting in London
6 Jun 2022 Food & Wine
New Zealand Winegrowers Annual Trade Tasting was recently held in London, on Wednesday 4 May, in Lindley Hall.
It was the first... more
Kiwi author stuns Behind the Butterfly Gate
12 Jan 2022 Arts
Hidden behind the Butterfly Gate is where the secret has been kept for 76 years...
New Zealand writer Merryn Corcoran’s... more
Property
Fairer rules for tenants and landlords
17 Nov 2019 Property
17 NOVEMBER 2019
The Government has delivered on its promise to the over one million New Zealanders who now rent to make it fairer... more
New Zealand Government will not implement a Capital Gains Tax
17 Apr 2019 Property
The Coalition Government will not proceed with the Tax Working Group’s recommendation for a capital gains tax, Jacinda Ardern... more
Migration
Boosting border security with electronic travel authority – now over 500,000 issued
19 Nov 2019 Migration
19 NOVEMBER 2019
We’ve improved border security with the NZeTA, New Zealand Electronic Travel Authority, which helps us to... more
Christchurch reinstated as refugee settlement location
18 Aug 2018 Migration
18 AUGUST 2018
HON IAIN LEES-GALLOWAY
The announcement that Christchurch can once again be a settlement location for refugees... more
Travel
Gallipoli Anzac Day services cancelled
19 Mar 2020 Travel & Tourism
The New Zealand and Australian Governments have announced this year’s joint Anzac Day services at Gallipoli will be cancelled... more
New Zealanders advised not to travel overseas
19 Mar 2020 Travel & Tourism
New Zealanders advised not to travel overseas
more
Sport
The Skipper's Diary: Sir Richard Hadlee honouring his father and NZ's Forty-Niners
27 Oct 2019 Cricket
NZNewsUK London Editor Charlotte Everett spoke to Sir Richard Hadlee about why he’s chosen to publish his father’s... more
PREVIEW: All Blacks v England semi-final
26 Oct 2019 Rugby
The two most convincing quarterfinals winners are set to square off in a semifinal showdown for the ages when the All Blacks meet old... more
Columns
Gordon Campbell on the Gareth Morgan crusade
11 Nov 2016 Opinion
Gordon Campbell on the Gareth Morgan crusade
First published on Werewolf
The ghastly likes of Marine Le Pen in France and Geert ... more
Gordon Campbell on the US election outcome
10 Nov 2016 Opinion
Column - Gordon Campbell
Gordon Campbell on the US election outcome
Well um.. on the bright side, there (probably)... more
Kiwi Success
Congratulations to Loder Cup winner
26 Sep 2018 People
25 SEPTEMBER 2018
The Loder Cup, one of New Zealand’s oldest conservation awards, has been awarded to Robert McGowan for 2018... more
Appointments to New Zealand National Commission for UNESCO
16 Aug 2018 Appointments
16 AUGUST 2018Appointments to New Zealand National Commission for UNESCO
HON JENNY SALESA
Associate Education Minister Jenny Salesa is... more
Recruitment
Historic pay equity settlement for education support workers
14 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more
Historic pay equity settlement for education support workers
22 Aug 2018 Recruitment
14 AUGUST 2018Historic pay equity settlement for education support workers
RT HON JACINDA ARDERN
HON CHRIS HIPKINS
Prime Minister
The... more