New Zealand dollar trades below 63 US cents

Daily Currency Update

The Kiwi dollar is slightly lower this morning when valued against the Greenback trading at 0.6307 at time of writing.  The New Zealand dollar (NZD) traded below 63 US cents on Wednesday falling to nearly three-week low of US$0.6277 during the first half of the European session. The pair is currently placed just above the US$0.6300 mark, down around 0.75% for the day, and is pressured by a modest US dollar strength.

On the data front yesterday New Zealand Trade Balance for November dropped to $-14.63B YoY and $-1,863M MoM versus the expected prints of $12.71B and $-1,091M respective market forecasts. That said, the previous readings were revised down to $-13.86B and $-2,298M. Details suggest that the Imports rose to $8.54B from $8.26B, whereas Exports also increased to 6.68B versus $5.96B prior. Earlier this week New Zealand business confidence slumped to a record low in December after the central bank delivered an unprecedented jumbo interest-rate hike and predicted the economy will enter recession next year. The monthly index of business sentiment fell to minus 70.2 from minus 57.1 in November, ANZ Bank New Zealand said Tuesday in Wellington. A gauge of firms’ own-activity expectations fell to minus 25.6 from minus 13.7. The Reserve Bank last month raised the Official Cash Rate by a record 75 basis points to 4.25% and projected the benchmark could rise to 5.5% next year as inflation pressures continue to buffet the economy. Rising costs and falling house prices are beginning to knock consumer confidence and household spending, with most economists agreeing with the RBNZ that a recession is imminent.