Kiwi slides as retail sales point to weak economy in third quarter
Results come after weak employment numbers and suggest the economy has hit a pothole.
The New Zealand dollar has fallen against most of its trading peers after figures show a drop in third-quarter retail sales, adding to weak employment numbers and suggesting the economy has hit a pothole.
The kiwi traded at 81.69 US cents from 81.88 cents at 8am in Wellington and from 81.66 cents in late trading the previous day. The trade-weighted index fell to 73.12 from 73.37 this morning.
Government figures today showed the volume of retail sales fell 0.4%, seasonally adjusted, in the three months ended September 30, against a Reuters survey calling for a 0.5% gain.
That adds to the gloom from data last week showing the jobless rate unexpectedly jumped to 7.3%, suggesting the economy's pace is stumbling.
Retail sales are "more evidence that the third quarter of this year was a soft patch for the New Zealand economy", says Imre Speizer, senior markets strategist at Westpac Banking Corp.
More up-to-date data, including business sentiment, suggests the economy has sped up again in the fourth quarter, he says.
The kiwi fell to 78.15 Australian cents from 78.45 cents. It did not move much after Australia's wage cost index for the third quarter rose 0.7%, close to market expectations of a 0.8% gain, for a year-on-year increase of 3.7%.
Mr Speizer says the figures do show some evidence that wage inflation is starting to slow in the mining sector.
The kiwi fell to 64.95 yen from 65.09 yen and slid to 64.21 euro cents from 64.47 cents. It dropped to 51.41 British pence from 51.62 pence.
(BusinessDesk)
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
Kiwi slides as retail sales point to weak economy in third quarter
25465