by Paul MacBeth
Monday 29th December 2008
|Text too small?|
New Zealand's official cash rate of 5%, having been slashed 325 basis points since July, is more than 4 percentage points higher than the Federal Reserve's zero-to-0.25% target range. New Zealand consumers increased spending in the post-Christmas sales rush, according to Paymark, the country's largest eftpos company, with transactions up 8% from a year earlier.
"In the next three weeks we could see the kiwi rally a bit," said Imre Speizer, currency strategist at Westpac Banking Corp. It should pass 61 U.S. cents before "it turns around."
The kiwi was little changed at 57.61 U.S. cents from 57.63 cents on Friday, having climbed from about 53 cents at the beginning of December. It rose to 52.24 yen from 52.12 yen. It dropped to 83.97 Australian cents from 84.21 cents and was little changed at 40.97 euro cents.
Speizer predicts the global financial rout will weigh more heavily on Asia in 2009, with China's economic growth slowing and Japanese production declining significantly. "Asia will start feeling the impact," he said.
Japan reported an 8.1% fall in factory production in November, and its Trade Ministry is predicting a further 8% decline for the month of December.
South Korean President Lee Myung Bak said his nation's economy may shrink in the first and second quarters of next year, the first such contraction since 1998.
Manufacturing in the U.S. is forecast to have contracted at its fastest pace since 1980 as slumping demand forces factory's to cut back production, according to a Bloomberg survey of economists.
No comments yet
NZ dollar gains on G20 preference for growth
NZ dollar dips as Wellington CBD checked for quake damage
NZ dollar gains, bolstered by RBA minutes, strong dairy prices
NZ dollar falls after central bank says it may scale up currency intervention
NZ dollar gains before CPI, helped by dairy gains, rally on Wall Street
NZ dollar trades little changed as US budget talks bear down on deadline
NZ dollar falls with equities on view US to sail over fiscal cliff
NZ dollar weakens as fiscal cliff looms, long bets unwind
NZ dollar sinks to three-week low as equities fall, fiscal talks in focus
NZ dollar slips as fiscal cliff talks grind slower in Washington