The quarterly survey of businesses from the Institute of Economic Research in New Zealand has found business confidence in the first quarter appears to be under threat mid-way through the second quarter. Companies reported they believe there could be price hikes on the cards.
Furthermore of the firms that were surveyed only 16% suggested there will be better economic conditions expected in the coming year, this is down from the 26% in December last year.
The international ratings agency Moody’s has kept New Zealand’s credit rating at the highest level, Triple-A. The agency mentioned that the economy has a stable outlook compared to a lot of countries around the world and this is considered positive for New Zealand. Moody’s also noted that the rise in economies such as China and the rest of Asia will only increase the demand for New Zealand’s main export dairy products and will continue to increase the tourism industry boom.
Despite the steadiness of the New Zealand economy the Kiwi has started to progressively lose ground against Sterling. The GBP/NZD rate was trading in the 1.60’s only 8 weeks ago and last week it nearly touched the 1.80 level. Whilst the NZD strength wasn’t going to last forever now is still a good time for selling New Zealand Dollars. In my opinion the rate is likely to keep rising as the US proposed interest rate hikes present a safer bet for investor profits.
If you’re looking to purchase New Zealand Dollars I would consider getting in contact with your trader on 01494 725 353 and setting rate alerts to make sure you’re notified if there is a spike in the market. There is so much market volatility that being prepared could help you make significant savings on any trades.
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