sorry - correction. The Euro - NZd is approx 1:2 ratio so the petrol price in NZ is approx 1/3 from what it is in The Netherlands....
Wow......... see those dumb kiwis just don't know how lucky they are Guess its a psychological thing for us down here. 2 years ago I bought a diesel wagon - fuel efficiency, clean emissions etc, and diesel at the time was around 60 cents a litre (plus some road taxes). Today its at $1.27 a litre, so more than 100% in 2 years. Petrol is not quite as bad in terms of increases but its up there. We have known for a long time that fuel prices in Europe are more expensive, but then so is everything else and the salaries etc are higher. Problem here in NZ is that public transport is poor so there is not much of an alternative to driving a car. Petrol increases are a dampener on domestic consumption and in effect aredoing more to slow down the economy than any interest rate increases.
Here in Puerto Rico, it's .76 a litre and all the Puerto Ricans are screaming! graemem - incidently, what was your take on the RBNZ statement? My thoughts were it was exactly as expected, no surprises at all. Kiwi seems a bit lighter on the take.
And now with the NZD trade surplus instead of a defecit this time, the NZ falls. WTF is up with the market this month?
It is pretty much as I expected from him, and you know I think he is totally hamstrung right now. Oil prices are in effect doing the job for him in terms of taking money out of the pockets of low and middle income earners who drive local consumption, so this offsets benefits from tax cuts for this sector. However, our low dollar is tempting for the 'smart money' who see it as a low risk entry into assets in what is a politically stable environment. So this may in turn help to establish a base for the currency down at this level. We are seeing a marked increase in foreign capital coming into the high end of the Real Estate market. AN this phenomenon is also happening in the STock market. Aussie capital recognises that the kiwi is cheap against the A$ right now, (not to say it may not get cheaper) BUT, moving money in from A$ will work against that scenario and sould move in the other direction or at least stop any further decrease. I don't buy the statement of the First Capital spokesman who "hopes to see a rate easening later this year". When did Hope ever become a strategy in FX - or any other market for that matter!!
I think you're off on the AUD flow into NZ, though. I see AUD/NZD going well, well over 20 in the next month or two.
Maybe you are right....... Me on the other hand, I see and hear from stockbrokers and those in the property market that money is coming in good volume from Australia into the markets here. Now when you move money into another currency for speculative purposes you don't normally place it in non liquid assets such as property and to a lesser extent, stocks - too difficult to move out again. Agreed? You would keep it in cash. What I am saying I guess is that the volume may not be enough to push the Kiwi higher against the A$ in the short term, but it may be enough to help establish a base at this level, a support area. This is kind of interesting for me as my positions in A$/NZ$/US$ tend to be long term. I don't mind seeing the NZ$ lower against the Aussie as it helps Kiwi exporters, however the Aussies are flush with cheap money from their cash rich compulsory superannuation schemes, so the greedy buggers look over the ditch and want a piece of paradise. Nothing worse than an arrogant Aussie with lots of cash!!! As I said yesterday, if the currency goes below 60 cents to the US (or 82.50 Aussie) then all bets are off in terms of predictions Good luck for tomorrow, Ivanovich
I'll agree that nothing is worse than an arrogant Aussie with lots of cash, mate! But in light of the rather upbeat data yesterday for NZ, we still are seeing a minor selloff against the USD. Now, that could be due to the USD's upbeat data as players begin to rethink the Fed - but nothing has been working the way it should, lately. Regardless, I made a good hundred pips on the upmove on AUD/NZD and will continue to buy into dips on that pair as RBA rates will definitely be going up, and your Fin Min just said that rates have peaked.