Foreign Currency Exchange

The kiwi remained under pressure against a basket of currencies at the earlier part of last week a head of the RBNZ rates decision on 24th.

There wasn’t much data released last week. However on Thursday we had the RBNZ rate decision out, with a rate cut of 0.25 basis points bringing it down to 8%, this surprised many market participants, as many weren’t expecting a cut until September. This is the first rate cut in 5 years and the RBNZ has indicated that there was more to come. It is reported that Hanover Finance (NZ fifth largest finance company) has suspended repayments on all of its loans as the credit crisis goes on, this comes after the National Australia Bank announced that is was writing off $798 million in credit market related losses.

The week ahead doesn’t look great for the NZD, with the release of Trade Balance for June, which is due out later today and the NBNZ (National Bank of New Zealand) Business Confidence survey due out at the end of the week, however if they are to come in positive, the Kiwi still faces a potential upside over the coming weeks.

With the RBNZ cutting rates it has caused the currency to drop. Now is an ideal opportunity to buy NZD as it is at a 3 month high, and with the pound looking to be in a vulnerable position, we don’t expect to see it go any further.

To ensure you get the best rate when buying your Currency stay in regular contact with your account manager, who will monitor the volatile currency markets for you and make sure you are in a position to move quickly with your funds so that you can take advantage of any spike in the market as and when it occurs as on large sums of money the saving can be ‘000s.