The NZD/USD is trading at 0.7309 gaining from declines in the US dollar. The pair is up 9 points while the greenback eased to 94.64 in the Asian session.
The NZD/USD is trading at 0.7309 gaining from declines in the US dollar. The pair is up 9 points while the greenback eased to 94.64 in the Asian session. Helping to support the local currency was a rise in dairy payouts. Dairy co-operative Fonterra has raised its forecast payout to dairy farmers. Its forecast has risen by 50 cents per kilogram of milks solids, taking the price to $4.75 for the current season.
When combined with the forecast dividend of between 50 to 60 cents a share, the total payout to Fonterra’s approximately 10,500 farmers is estimated at $5.25 to $5.35 per kilo. Most farmers need about $5 per kilo of milk solids cover costs.
The forecast increase follows a sharp improvement in dairy prices, which have risen by more than 20 percent in the last two GlobalDairyTrade auctions. Fonterra chair John Wilson said while global milk prices remained at unrealistically low levels, global milk production had declined.
“Milk production is reducing in most dairying regions globally in response to low milk prices and this is bringing the world’s milk supply and demand back into balance. Milk production in the EU is now in decline and our New Zealand milk collection at this early stage is around four per cent lower for the year to date.”
Speculators have been waiting for the central bankers’ symposium in Jackson Hole, Wyoming where Federal Reserve chair Janet Yellen is scheduled to speak in the hopes she might deliver firmer guidance on when the Fed might resume raising interest rates.
The Fed’s rate outlook has been a major factor in determining where the kiwi goes, with New Zealand’s interest rates offering investors an attractive return with many other central banks running near-zero rate policies and buying assets to stimulate their economies. That’s created a problem for Reserve Bank governor Graeme Wheeler who has struggled to meet his inflation target because of the strong kiwi dollar.
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August 29, 2016
Country | Event | Volatility | Previous |
USD | Personal Consumption Expenditures | 2 | 0.9 |
USD | Core Personal Consumption | 2 | 0.1 |
USD | Personal Income | 2 | 0.2 |
USD | Personal Consumption Expenditures – | 2 | 0.1 |
USD | Personal Spending | 2 | 0.4 |
USD | Core Personal Consumption | 2 | 1.6 |
USD | Dallas Fed Manufacturing Business | 2 | -1.3 |
Government Bond Auctions
Date Time Country Auction
Aug 25 18:00 US Holds 7yr note auction
Aug 26 10:10 Italy Holds zero coupon