Scoop has an Ethical Paywall
ASB Kiwi Dollar Barometer - Expectations of NZD depreciation
Media Release
ASB Kiwi Dollar Barometer
EMBARGOED UNTIL 0500 WEDNESDAY 4 SEPTEMBER 2013
Expectations of NZD depreciation
• Businesses expect the
NZD/USD to peak at 0.803 in March 2014 before falling to
0.753 by September.
• Increased interest to
hedge amongst importers due to expected depreciation.
• Majority of businesses shortened duration of
hedging in response to recent shifts in the NZD.
New Zealand businesses expect the NZD to peak against both the USD and AUD in March 2014 before easing according to the latest ASB Kiwi Dollar Barometer.
“While both importers and exporters expect the NZD/USD to depreciate over the coming year, exporters are expecting a much larger decline in the currency by September 2014,” says ASB Chief Economist Nick Tuffley. “This large divergence between importers and exporters’ expectations likely reflects the high degree of uncertainty over the NZD outlook in light of the relatively wide range the NZD/USD has traded in recently.”
The expectations of a depreciation in the NZD have seen increased interest to hedge amongst importers. In contrast, exporters have trimmed back hedging intentions. However, exporters that do intend to hedge continue to plan hedging a higher proportion of their FX exposures than importers plan to.
The Barometer finds the majority of businesses have reduced the duration of their hedging in response to recent shifts in the NZD, with exporters tending to shorten the duration of hedging by a greater length of time compared to importers.
“The NZD has traded over a
relatively wide range in recent months, leading to increased
uncertainty over which direction the currency will go in the
coming year. Increased volatility also means it is now more
expensive to hedge using options. These factors may be
discouraging some businesses from hedging too far out in
time,” concludes Mr Tuffley.
Full Report:
Embargoed_ASB_Kiwi_Dollar_Barometer_September_2013.pdf
ENDS
ASB Bank
Helping you get one step ahead.
In 1847, ASB opened as the Auckland Savings Bank with the pledge: 'to serve the community; to grow and to help Kiwis grow'. And that is very much what ASB is about today.
ASB is a leading provider of integrated financial services in New Zealand including retail, business and rural banking, funds management and insurance.
ASB strives to consistently provide its customers with outstanding service and innovative financial solutions. They're dedicated to providing simple financial products that allow their customers to bank with them how and when they want.
We all have our own ways to measure progress, and our own stories about the things that matter to us. Whatever way you choose to measure progress, and whatever your goals, ASB is there to help you get one step ahead.
Antarctica New Zealand: International Team Launch Second Attempt To Drill Deep For Antarctic Climate Clues
Vegetables New Zealand: Asparagus Season In Full Flight: Get It While You Still Can 
Bill Bennett: Download Weekly - How would NZ telecoms cope with another cyclone
NZ On Air: Firm Audience Favourites Lead NZ On Air Non-Fiction Funding
Insurance and Financial Services Ombudsman: Woman Gets $40k More After Disputing Insurer’s Decision
BNZ: A Quarter Of Older NZers Fear Going Online Due To Scam Concerns
