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28 Jan 2014
NZ FinMin English concerned by AUD/NZD low rate
FXstreet.com (Bali) - The New Zealand Finance Minister Bill English is starting to sound unusually aggressive on its rhetoric towards the AUD/NZD exchange rate, saying the New Zealand dollar is overvalued against its neighboring counterpart, and that is making it difficult for exporters in the country.
The AUD/NZD has been the steadiest trend in the FX market arena ever since topping out around the 1.30 mark mid 2012, leading to a 25 cents decline or around -0.2% in 18 months, averaging losses of over 1% each month, quite consistently.
English comments - Fairfax NZ News
"It's an increasing headwind for those businesses that are selling into Australia; 95 cents is higher than it's been for a long time. I think 12 months ago it was as low as 80c [Australian]," English said, cited by Fairfax NZ News.
"So it's a bit of a concern, but I would imagine the Australian economy will turn out to be a bit stronger than people would expect and we'd like to see that exchange rate drop back."
"I think it's too high, yes, and I think the Australian economy's a bit stronger, relative to ours, than that indicates."
The interesting part about English comments is the fact that he no longer makes reference to the NZD over-valuation alone, but does something quite rare, which is specifically making mention of the AUD/NZD. Something to keep an eye on.
The AUD/NZD has been the steadiest trend in the FX market arena ever since topping out around the 1.30 mark mid 2012, leading to a 25 cents decline or around -0.2% in 18 months, averaging losses of over 1% each month, quite consistently.
English comments - Fairfax NZ News
"It's an increasing headwind for those businesses that are selling into Australia; 95 cents is higher than it's been for a long time. I think 12 months ago it was as low as 80c [Australian]," English said, cited by Fairfax NZ News.
"So it's a bit of a concern, but I would imagine the Australian economy will turn out to be a bit stronger than people would expect and we'd like to see that exchange rate drop back."
"I think it's too high, yes, and I think the Australian economy's a bit stronger, relative to ours, than that indicates."
The interesting part about English comments is the fact that he no longer makes reference to the NZD over-valuation alone, but does something quite rare, which is specifically making mention of the AUD/NZD. Something to keep an eye on.