Kiwi up on retail sales data

JAZIAL CROSSLEY
Last updated 17:34 14/08/2012

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The New Zealand dollar rose against the greenback today after data showed local retail spending was up as Kiwis injected more cash into the economy for consumer goods.

The kiwi recently traded at US81.01c, up from US80.84c in the morning. On the Trade Weighted Index against major trading partners' currencies it was at 72.90, up from 72.71 earlier.

The Statistics New Zealand retail sales data showed spending was up 1.3 per cent in the June quarter with motor vehicles and car parts leading the charge, up a record 7.3 per cent. Core retail sales volumes rose 0.9 per cent especially in the pharmaceutical, food and beverage service categories.

Westpac market strategist Imre Speizer said the kiwi had meandered higher in the morning, then back lower in the afternoon.

"It did have a bit of a surprise move upward after the retail sales figures, it rose around 20 basis points, then it kind of stagnated thereafter and drifted off a bit."

Economists had been expecting a rise in the retail sales figures.

"The kiwi could get a bit more reaction in the London session from the retail data. I think over the days to come the kiwi will ease, it does look soft.

"There is lots of data due out tonight - in the US tonight retail sales are coming out and in the euro zone Germany's GDP is due," Speizer said.

It is expected that if US retail sales figures fall, it could increase the chances of the US Federal Reserve considering quantitative easing moves.

On the crosses, the kiwi was at 77.01 Australian cents, up from A76.91c in the morning. It was at 65.56 euro cents, up from 65.53 euro cents earlier. It rose to 51.61 pence from 51.53 pence earlier.

Speizer said the kiwi could trade between US81.30c and US80.80c overnight, with a bias towards the downside.

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- BusinessDay.co.nz

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