NZ dollar gains vs. Australian dollar after mining investment slumps across the Tasman
The kiwi rose to 90.96 Australian cents from 90.57 cents immediately before the release.
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The New Zealand dollar gained against its trans-Tasman counterpart after figures showed Australian mining investment slumped in the third quarter, reigniting speculation the central bank may have to cut interest rates again.
The kiwi rose to 90.96 Australian cents from 90.57 cents immediately before the release, and 90.38 cents yesterday. The local currency was little changed at 65.86 US cents at 5pm in Wellington from 65.70 cents at 8am and 65.78 cents yesterday.
The Australian dollar dropped after Bureau of Statistics figures showed mining investment dropped 10 percent in the third quarter, ithe biggest quarterly decline on record. Total capital expenditure fell 9.2 percent in the three months ended Sept. 30, stoking talk the Reserve Bank of Australia may have to continue reducing interest rates which are already at a record low.
"Australian private investment capex dropped quite sharply, and if that continues, it raises the probability the Reserve Bank will cut rates," said Michael Johnston, senior trader at HiFX in Auckland. "That caused the kiwi/Aussie to bounce back."
Still, Johnston expects the local currency will resume its decline against the Australian dollar in the medium term, with New Zealand's Reserve Bank likely to cut the official cash rate when it next reviews monetary policy in December.
The currency didn't move much after government data today showed China reclaimed its top spot as New Zealand's biggest export destination on increased sales of beef, milk powder and kiwifruit.
New Zealand's two-year swap rate fell two basis points to 2.68 percent at 5pm in Wellington and the 10-year swap rate fell five basis points to 3.52 percent.
The kiwi increased to 4.2098 Chinese yuan from 4.2019 yuan yesterday, and rose to 80.78 yen from 80.46 yen. It gained to 62.02 euro cents from 61.62 cents yesterday, and was unchanged at 43.54 British pence.
(BusinessDesk)
Paul McBeth
Thu, 26 Nov 2015
Thu, 26 Nov 2015
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NZ dollar gains vs. Australian dollar after mining investment slumps across the Tasman
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