THE New Zealand Dollar began last week trading at around 1.9723 to the British Pound and around 1.2197 against the US Dollar. The Kiwi strengthened against both currencies to end the week at 1.9403 to the Pound and 1.2025 to the Dollar on Friday. The NZ currency opened even stronger this week at 1.9318 to the Pound and 1.2021 to the US Dollar.
The Kiwi strengthened on market optimism that the US would not go over the so-called ‘Fiscal Cliff’. The US also announced positive economic numbers in the form of higher than expected jobs data for December and non-manufacturing economic activity being stronger than anticipated. Positive economic growth in the world’s largest economy will continue to boost emerging economies including New Zealand.
This coming Thursday will see local data being released in the form of the ANZ commodity price index and November’s overseas merchandise trade numbers. Both announcements are likely to affect the direction of the Kiwi this week due to New Zealand’s economic dependence on exports and commodities.
The Japanese newspaper Yomiuri reported today that the new Shino Abe led government is likely to extend the budget to include 6 trillion yen ($68 billion) for public works. This information has not been confirmed yet by the government but their stated intentions point to this approach to fiscal policy. Developments in Japan are likely to affect all nations in the Asia-Australasia area in the upcoming months.
Composed by Elizabeth Britz of 1st Contact Money Transfers
Exchange rates as of 09:40, 7 January 2013
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