NZ$ at 5-year high against Yen

The Opening Bell: Where currencies start for Wednesday, April 10, 2013

Currencies

The Opening Bell: Where currencies start for Wednesday, April 10, 2013

10th Apr 13, 9:12am by Dan Bell

The NZDUSD touched a high of 0.8535 overnight, a level last since in September 2011.

The NZDJPY continued it stormed upwards to hit 5-year high of 84.75, while understandably the NZD TWI (trade-weighed index) establish a new all-time high of 78.36.

Last week’s aggressive monetary easing by Japan is firmly in the drivers seat behind currency market movements.

This is likely to continue if comments from Japan’s Finance Minister is anything to go by when he said that the JPY was undergoing a correction from previous “excessive” rises.

The markets seem to be ignoring concerns regarding the Cyprus bailout, Italian political uncertainty, and Spain’s dire fiscal and economic conditions.

Gold prices trades higher at USD$1585, while Copper prices climbed to 2-week highs.

World equity markets were higher across the board.

The NZD opens at 0.8520 USD, 0.8125 AUD, 0.6515 EUR, 0.5560 GBP, & 84.35 JPY.

There is nothing on the domestic data calendar today.

Australian Consumer Confidence and Chinese Trade Balance will be released this afternoon.

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Dan Bell is the senior currency strategist at HiFX in Auckland. You can contact him here »

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8 Comments

by Stephen Hulme | 10th Apr 13, 9:49am 1365544181

The NZDJPY continued it stormed upwards to hit 5-year high of 84.75

Since a recent low was ~60.00, can we assume that buyers of Japanese goods will notice a 30% fall in prices - I have not witnessed a fall in price anywhere and in particular a constant review of a car familiar to me has seen the sticker price stubbornly stuck at ~NZD 70,000

When will the national pastime of gouging each other be prohibited in law.?

by idlebumski | 10th Apr 13, 1:28pm 1365557294

Edit. Nice looking chariot, Mr Hulme. Careful of the depreciation though; mate of mine bought one of these some years back, same model and price. He sold for 9k. Granted, by then it had been rolled, bowled and as#holed. Good point about the savings yet to show from currency manipulations; everybody further up the chain will take their bite leaving you with crumbs if you're lucky. As customer, you are the guy funding all of them, so of course your rights here reflect that.

by Stephen Hulme | 10th Apr 13, 1:44pm 1365558248

LOL - I don't own that particular model - I bought a new pre-registered Japanese import 3.0L flat six back in Jan 2006 for around NZD 41,500 when list price was ~NZD 60,000. I run them into the ground before I sell them - usually 10 years. Still only done 65,000kms. I do need to get out more.

We had to ditch two turbo models at the same time as the insurance company declined to insure my then 15 year old son as a driver. Great surf and ski wagons

by Wolly | 10th Apr 13, 1:35pm 1365557705

Fools will be buying now when waiting will bring a huge drop in price..cars..tvs..whatever the Japanese export...and their competitors will follow along.....and any retailer in NZ will be bailing out fast at the old prices.

by idlebumski | 10th Apr 13, 3:25pm 1365564347

Pretty much everybody in Japan is now poorer, behind all the other countries that have already been taken down. If globally the average Joe SixPack is suffering, inflation is not a threat. What the central banks are doing, (IE: giving to those who own, versus those who do) in the big scheme of things will only reinforce the market's desire to deflate. Two things amaze me;

The central banks lead, and so once they find a bottom or begin raising, every man and his dog will know it's game on, again. But not before. Don't they see this?
If they want people employed, in the case of USA, I don't know why they just didn't offer payroll tax relief to employers for any new employees.

Imagine having the govt subsidize labor and the working man to the extent they have supported fat cats. Granted, in that scenario, inflation wouild be a threat. But hold on; aint that what it's about?

by Matt in Auck | 10th Apr 13, 3:48pm 1365565710

I am flying to japan today and my aus dollar is going to go a long long way... one aussie dollar more than 100 yen

by idlebumski | 10th Apr 13, 3:51pm 1365565862

According to Krasting of BI, it's getting cheap there now. Let us know. http://www.businessinsider.com/japan-at-currency-war-2013-4

by moa man | 10th Apr 13, 4:06pm 1365566798

Just got back from a month of tiki touring around Japan via train.

I was surprised how cheap everything was, and that was before the BOJ action.