Sharechat Logo

NZ dollar eases as U.S. data supports greenback, earnings damp risk appetite

Monday 18th January 2010

Text too small?

The New Zealand dollar fell after U.S. data underpinned support for the greenback while weak earnings in the world’s largest economy damped investors’ appetite for risk.

American inflation was a smaller-than-expected 2.7% in the 12 months through December, while the Empire manufacturing survey beat forecasts to rise to 15.92 this month, helping support sentiment for the world’s reserve currency.

Fourth-quarter corporate earnings have continued to disappoint, with investment bank JPMorgan’s larger-than-expected loan losses raising concerns about the financial sector.

The Dollar Index, a measure of the greenback against a basket of currencies, rose 0.2% to 77.17 after European Central Bank President Jean Claude Trichet said Greece wouldn’t get any “special treatment” as a result of its fiscal problems.  “The euro underperformed while Greece remained a problem and the U.S. dollar edged higher,” said Mike Jones, strategist at Bank of New Zealand. “The kiwi drifted lower and has traded tightly around the bottom of its recent ranges.”  The kiwi dropped to 73.69 U.S. cents from 73.80 cents on Friday in New York, and declined to 66.64 on the trade-weighted index, or TWI, a measure of the currency against a basket of five trading partners, from 66.67. It slipped to 66.74 yen from 66.97 yen on Friday, and edged up to 79.86 Australian cents from 79.63 cents. It was little changed at 51.22 euro cents from 51.21 cents last week, and increased to 45.26 pence from 45.19 pence.  Jones said the currency may trade between 73.50 U.S. cents and 74.40 cents today as it trades in recent ranges until Wednesday’s consumer price index data release.

Economists predict inflation was probably flat in the fourth quarter last year, compared to the central bank’s -0.2% forecast, and the market predicts Governor Alan Bollard will be forced to hike the official cash rate by as much as 75 basis points by the end of June.  

Real Estate Institute data today showed house prices rose 1.4% to $360,000 in December from November though sales fell below 5,000 to a “concerning” level.

Property values climbed 2.8% last year according to QV Valuations, and are only 4.7% from their peak in 2007.  

 

Businesswire.co.nz



  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comment:
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:

SML - Synlait Milk Limited - Trading Halt of Securities
AIA - Auckland Airport announces board chair changes
AIA - Auckland Airport announces board chair changes
CEN - Tauhara commissioning progress update
FPH initiates voluntary limited recall
March 28th Morning Report
KFL Celebrates 20 Years of Excellence in Investment Mgmt.
SVR - Savor FY24 Earnings Guidance & Change in Banking Partner
NZK - NZ King Salmon Investments Limited FY24 Results
March 27th Morning Report