World First NZ Economic Update

• The NZ economic data released in January has been somewhat of a mixed bag.
• On the positive side the fourth quarter of last year saw business confidence in New Zealand rise, having been fairly flat during the middle of the year.
• During the same period there was also a 2.3% increase in CPI (Consumer Price Index) which was in line with the RBNZ’s expectations following the increase in GST.
• At their end of January meeting the RBNZ, as expected, left the Official Cash Rate unchanged at 3%.
• Economists now expect the OCR to be left on hold until September and even then the RBNZ are likely to take an extremely cautious approach to implementing hikes.

Currency Movement:

GBPNZD – Since the momentary drop in the rate to GBPNZD 2.00 during the Christmas period this pairing has for the most part traded in the GBPNZD 2.05 – 2.1 range with little suggestion that it will climb higher.

EURNZD – January saw a slight recovery from the Euro pushing the EURNZD rate up from 1.70 to 1.79

NZDUSD – By and large the NZDUSD rate has spent the past month trading between 0.75 and 0.77 with the NZD making occasional rallies to try and break to higher ground.

NZDZAR – January was a month of gains for the NZD against the Rand. The rate moved up from NZDZAR 5.10 at the start of the month to NZDZAR 5.40 at the end of the month.