N.Z. dollar moves down to $US0.52

Press, 14 December 1985, Page 21

N.Z. dollar moves down to $US0.52

PA Wellington The New Zealand dollar continued its slide on the foreign-exchange market yesterday, nearing pre-float levels. This was reflected by the trade-weighted Reserve Bank exchange rate index, which measures the currency against those of New Zealand’s main trading partners. By 3 p.m., the index had fallen to 66.5, down from 67.2 at 1 p.m., compared with 62.7 before the float.

The index was at a postdevaluation peak of 75.2 on October 14.

Against specific currencies, the unit was well down from its highs of AustB9.l7c (November 7) and U559.5C (October 15) to Aust77.lc

and U552.6C yesterday. The kiwi dollar’s low for the day was $U50.5265 compared with its $U50.5320/35 opening. Near the close it was at $U50.5260/75.

Dealers blamed the drop in the kiwi dollar on European “dis-investment” from New Zealand. ■

Earlier this week they said there was evidence of the Japanese bulling .out of New Zealand investments. Dealers, normally keen to predict a downslide potential, were reluctant to do so, given the present bearish mood of the market.

“It’s entirely open to conjecture as to its bottomside at the moment,” one dealer said.

Another said it was simply a matter of more sellers than buyers in the market.

Exporters had not been Eninent and it appeared they were still hanging back from buying in the hope of a lower kiwi dollar. Yesterday’s Government stock tender, in which interest rates fell again, may have had some bearing on the softer kiwi, but most of the damage was done before the release of tender details. Against other currencies, the New Zealand dollar was worth 1.32 marks, 36.7 p and 106.5 yen. The U.S. dollar traded at 2.5145/55 marks and 202.20/

30 yen inthe late afternoon against 2.5185/00 and 20222/ 32 in the morning. Sterling : traded at $U51.4350/60, from $U52.5185/00,: while the Australian? dollar was little changed at $U50.6842/49. The value of the New Zealand dollar yesterday, morning, compared with its value immediately : before it was floated in March, was: Mar. 1' Dec. 13 U.S. 44c . 52.4 c Sterling 41.15 p 36.54 p Canada 612 c 73.2 c France 4.49 fr 4.03 fr H.K. . $3.43 . $4.08 Lx Japan 114 yen 106 yen Nethlands 1.66 g 1.48 g S’pore 99c $l.ll Switz. . 1.26 fr I.loftGermany 1.47dm 1.32dm Aust. 62.4 c 76.7 c The selling rates are those quoted by the Bank, of New Zealand. In New York the U.S. dollar went down on Thursday (early yesterday, N.Z. time) ’ after news that interest rates on short-term U.S. Treasury bonds declined at the weekly auction earlier in the day. Gold rose slightly. The dollar closed at 2.52025 marks (2.53425 the previous day), 7.7050 French francs (7.7360), 2.1115 Swiss francs (2.1225), 0.69775 pounds (0.70565) and 20225 yen (203.70). Gold closed at $U5317.10 an ounce ($316.80). In Tokyo later, the U.S. dollar opened at 202.15 yen on the foreign exchange market yesterday, down from Thursday’s close of 202.80 yen.