The New Zealand Dollar climbed above 83 Australian cents for the first time since October 2009 as investors look for increasing returns in the smaller oceanic nation ahead of next week’s Australian Central Bank interest rate decision.
New Zealand yields have become very attractive to investors due to the increasing pace of economic recovery and the New Zealand Reserve Bank look more likely to hike interest rates over the next year. New Zealand government bonds – especially the 10-year ones – have gained in value by as much as 3.18%, 13 basis points above its Australian equivalent.
The Australian Reserve Bank is set to review its monetary policy next week and the market is increasing its bets that a rate cut could come later in the year.
“A rate cut is starting to get more priced in, and from a commodity price point of view, agriculture and food prices have held up remarkably well, which benefits New Zealand’s exports more than Australia”, said Dan Bell, a currency strategist in Auckland. “The Kiwi/Aussie cross rate has been in an up-trend for a while and is reversing a lot of the losses it has had over the last few years.”
The next piece of key data that will affect the currency is the US employment figures due later on Friday. The data is expected to show that the US economy added around 140,000 jobs last month. If the data comes in worse-than-expected, the ‘Kiwi’ could make a retreat against the US Dollar.
Current New Zealand (NZD) Exchange Rates
The New Zealand Dollar/US Dollar Exchange Rate is currently in the region of: 0.8509
The New Zealand Dollar /Euro Exchange Rate is currently in the region of: 0.6490
The New Zealand Dollar/Pound Sterling Exchange Rate is currently in the region of: 0.5480
The New Zealand Dollar /Australian Dollar Exchange Rate is currently in the region of: 0.8299
The US Dollar/ New Zealand Dollar Exchange Rate is currently in the region of: 1.1751
The Pound Sterling/New Zealand Dollar Exchange Rate is currently in the region of: 1.8247
The Euro/ New Zealand Dollar Exchange Rate is currently in the region of: 1.5408
The Australian Dollar/New Zealand Dollar Exchange Rate is currently in the region of: 1.2048
The Canadian Dollar/New Zealand Dollar Exchange Rate is currently in the region of: 1.1609
(Correct as if 09:40 GMT)
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