Sharechat Logo

NZ dollar falls vs Aussie after Australia posts record trade surplus

Thursday 2nd February 2017

Text too small?

The New Zealand dollar fell against the Aussie dollar after Australia posted a record trade surplus in December, stoking optimism about the outlook for economic growth across the Tasman.

The kiwi dollar fell to 95.52 Australian cents as at 5pm in Wellington from 96.10 late yesterday. The local currency edged up to 72.98 US cents from 72.62 cents yesterday.

Australian posted a seasonally adjusted trade surplus of A$3.5 billion in December, the Australian Bureau of Statistics said Thursday. 

The kiwi "came off quite significantly against the Aussie," said ANZ Bank New Zealand senior economist Philip Borkin. "It was a 'mammoth' trade surplus over there. The rebound in commodity prices over there is doing wonders for the Australian economy," he said. 

Borkin said the kiwi gained against the US dollar when the US Federal Reserve was "slightly less hawkish than the market was looking for" and has benefited over the day as the greenback continues to lose ground. 

Overall, however, he said it was a fairly "whippy, roller coaster day," with the kiwi reacting to some headlines on the New Zealand Herald about a possible tuberculosis outbreak on a dairy farm in the Waikato. It initially fell but then rebounded when it became clear it was a minor, contained incident and had happened before, Borkin said.

Looking ahead, he said the main event for markets will be the Bank of England's rate decision overnight with some speculation that they BoE may less dovish as "the UK economy continues to defy expectations post-Brexit" and inflation is certainly picking up. 

The trade-weighted index was at 79.35 from 79.20. The kiwi was at  5.0180 yuan from 4.9939 yuan and at 67.59 euro cents from 67.28 cents. It traded a 57.59 British pence from 57.75   pence late Wednesday and at 82.23 yen from 82.18  yen,

New Zealand's two-year swap rate rose 2 basis points to 2.40 points while the 10-year swaps rose 4 basis points to 3.57 percent.

Bond Offer: Infratil Ltd, 7.2 year & 10.2 year unsecured unsubordinated bond

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar edges higher as concerns over Saudi attack ease
UK trade minister pops up into Wgtn, promises 'better deal' for NZ ag exports
A2, Synlait shares climb as takeover bid revives optimism about Chinese appetite for milk
Primary sector export revenue seen down 0.5% in FY2020
Z, BP, Waitomo challenge ComCom claims on excess returns
Abano shares jump 10% on takeover speculation
Service sector activity eases in August but still expanding
Abano shares jump 10% on takeover speculation
Service sector activity eases in August but still expanding
ANALYSIS: Wealth management now wags the stock-broking dog

IRG See IRG research reports