Aussie holidays look enticing as kiwi soars
More Kiwis are expected to book an Australian holiday after the New Zealand dollar hit a five-year high against the Australian dollar, but exporters are beginning to hurt.
The kiwi was trading at A90.36c at 5pm after reaching a high of A90.56c earlier in the day. The last time the New Zealand dollar was at these levels was in 2008.
House of Travel commercial director Brent Thomas said the high New Zealand dollar made an Australian holiday more affordable.
Australia was already our favourite destination, with more than 1 million Kiwis heading across the Tasman each year.
However, the high dollar and additional airline capacity from New Zealand to Australia meant even more holidaymakers would be heading across the ditch next year, he said.
Tourism Australia expected 4.9 per cent growth in the New Zealand market, with an extra 4000 New Zealanders travelling to Australia each month, Thomas said.
When the high New Zealand dollar was highlighted people were more likely to impulsively book holidays, he said. He expected an increase in bookings for Christmas holidays and long weekends to Australia next year.
OM Financial senior foreign exchange and derivatives adviser Stuart Ive said the New Zealand dollar had continued its rally from recent weeks against the Australian currency.
Ive said the next resistance level for the New Zealand dollar was A90.9c. If the kiwi broke through that barrier it would be eyeing the A95c mark, a level not reached since 2005. "We're closing the gap fairly rapidly."
If the New Zealand dollar did surpass A90.9c it would become an issue for exporters and the Reserve Bank, Ive said.
ExportNZ executive director Catherine Beard said the extent of exporters' troubles would depend on how long the high dollar persisted.