New Zealand Dollar continues to fall

NEW ZEALAND DOLLAR REVIEW | The Bloomberg Correlation-Weighted Index rated the Kiwi as the second-worst performer among ten developed-nation currencies.

 
 

GBP NZD

AFTER a particularly disappointing month for the New Zealand Dollar, the currency had an uneventful day of trading on the UK bank holiday, trading at 1.949 against the British Pound and 1.231 against the US Dollar. However, during Tuesday trading the Kiwi declined sharply from 1.951 to 1.966 on the release of weak farm data.

New Zealand’s largest dairy exporter, the Fonterra Cooperative Group Ltd. announced diminished profits due to a relatively strong Kiwi, and that it would most likely reduce the amount paid to its farmers for dairy products. The result was a weakening in the currency to a near four week low.

Internationally, investors were looking ahead to the Jackson Hole event where US Federal Reserve chair Ben Bernanke was expected to announce further quantitative easing (QE) measures. Late week reports released before the summit showed a “gradual” expansion in the US economy, increasing demand for safe-haven currencies, and sapping that for the more growth-linked such as the Australian Dollar and the Kiwi. Over the past month, the Bloomberg Correlation-Weighted Index rated the Kiwi as the second-worst performer among ten developed-nation currencies with a fall of 2.2 percent.

The outcome of the Jackson Hole summit resulted in Bernanke stating that he would not rule out quantitative easing, in a bid to halt the jobless rate.

Donald Williams, of Platypus Asset Management Ltd said on Bloomberg, “I think it’s going to be difficult for the market to keep rallying on the promise of QE and other measures without some improvement in the data,” echoing investor demand for a quantifiable result from the US’s stimulus packages.

Ahead, the European Central Bank will meet on Thursday in Frankfurt, where an interest rate cut is expected.

GBP/NZD: 1.984
USD/NZD: 1.250
NZD/EUR: 0.634
NZD/AUD: 0.778

Exchange rates as of 09:15 GMT+1, 03 September 2012

Composed by Jesse Crooks of 1st Contact Forex

:: Note: The above exchange rates are based on “interbank” rates.  If you want to transfer money to New Zealand then please register/login or call us for a live dealing rate. Make use of a Rate Notifier to send you alerts when the New Zealand exchange rate reaches levels you are looking for.

 
 

 

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