The New Zealand Dollar made gains against the weakened Pound and ticked higher against the US Dollar after New Zealand’s Finance Minister signalled that the nation will post a surplus as the economy continues to improve.
Against the Pound the ‘Kiwi’ jumped to a one-month high after yesterdays Bank of England comments.
The BoE dashed the hopes of investors who had been expecting it to signal a tightening of its monetary policy.
“The Bank of England failed to boost expectations for monetary tightening. Going into the release of the quarterly inflation report, most investors were positioned for a more optimistic and hawkish outlook from the central bank. They were hoping that the BoE would signal plans to raise interest rates this year but the central bank refused to deliver,” said the managing director of foreign exchange strategy at BK Asset Management.
The ‘Kiwi’ shrugged off the release of data which showed that manufacturing output fell in April.
The Business New Zealand Manufacturing Index softened to 55.2 in April from the 58.0 seen in March.
The figure was also below economist forecasts for a figure of 58.4.
Any figure above 50 indicates expansion whereas one below indicates contraction.
Investors instead were more interested in the nation’s annual budget.
The New Zealand Treasury said that it expects the nations operating balance before gains and losses will be a surplus of $372 million before 30th June 2015.
The figure was far more than the previously forecast figure of $86 million.
By 2018 it expects the surplus could reach $3.5 billion.
The nation’s economy is expected to grow by 4% in the year ending March 31st 2015, the fastest increase in growth seen since 2004 and was better than the previous forecast of a 3.6% rise.
The Treasury also said that it expects the nation’s unemployment rate to drop to 4.4% in 2018, a sharp fall from its previous forecast for a drop to 5.4%.
New Zealand Dollar (NZD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
New Zealand Dollar,
,US Dollar,0.8670 ,
New Zealand Dollar,, Pound Sterling,0.5184 ,
New Zealand Dollar,,Euro,0.6343 ,
New Zealand Dollar,,Australian Dollar,0.9255 ,
Euro,, New Zealand Dollar ,1.5786 ,
US Dollar,, New Zealand Dollar ,1.1510 ,
Australian Dollar,, New Zealand Dollar ,1.0807 ,
Pound Sterling,, New Zealand Dollar ,1.9307 ,
[/table]
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