Friday 19th February 2010 |
Text too small? |
The New Zealand dollar fell below 70 US cents after the Federal Reserve hiked the discount rate charged to banks for direct loans, in a sign American regulators are moving toward winding down stimulus measures.
The kiwi dropped to 69.71 US cents from 70.27 cents before the announcement as the discount rate was lifted 25 basis points to 0.75%, the first increase in three years. The Dollar Index, a measure of the greenback against a basket of six currencies, climbed 0.8% to 81.05, the highest level since June.
“It points to the exit door quite explicitly – it’s quite a powerful message,” said Imre Speizer, markets strategist at Westpac Banking Corp. “It puts the dampener on risk markets and we’d expect (US) equities to get hammered tonight” which will see the kiwi under further pressure, he said.
Investors were bullish on the prospects for the trans-Tasman currencies this morning with Reserve Bank of Australia Governor Glenn Stevens expected to give an upbeat assessment of Australia’s economy when he testifies before Parliament today.
The Australian dollar dropped 1.1% to 89.17 US cents. Support for the US dollar has grown this year as investors grow sceptical over the recovery of the Euro-zone region, amid ongoing sovereign debt issues in the so-called PIIGS (Portugal, Ireland, Italy, Greece and Spain).
Businesswire.co.nz
No comments yet
TGG - Response to media speculation
ARB - Annual Meeting Date and Director Nominations
CNU - Q4 FY25 Connections Update
MOVE FY25 Results and Investor Briefing 29 August 2025
RYM - First quarter trading update
July 11th Morning Report
IKE Announces equity raising of A$20 million
Chorus full year results date
FPH 2025 Notice of Annual Meeting and Voting Form
July 10th Morning Report