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Westpac will now only give you NZ$1 for each AU$1 you sell them via a telegraphic transfer in a retail transaction according to their online tools

Currencies
Westpac will now only give you NZ$1 for each AU$1 you sell them via a telegraphic transfer in a retail transaction according to their online tools

We have parity between the NZD and the AUD !

But not on wholesale markets - yet.

In the past hour Westpac will only pay you NZ$1 for each AU$1 you want to sell them.

This rate applies for when you convert foreign currency coming to you in an international wire transfer. (It will not apply if you try to sell the bank notes or travellers cheques - you will likely get less.)

Remember, fees and fee minimums will almost always apply, and will reduce your net return.

You can see all main bank BUY rates here.

The wholesale rate is NZ$1 = 98.2 AUc as we publish this. But that is a "mid-rate" from which banks and other foreign exchange dealers price their BUY and SELL rates from. In other words, no-one can actually get the mid wholesale rate; you get one based on it, plus a margin.

At retail for telegraphic transfers, Westpac now prices parity between the two currencies when you want to sell them AUD. The other local retail banks will likely follow very soon. And in turn, the specialist currency trading companies will get there as well at some time, although they don't work on such wide margins.

There will be volatility around bank offer rates and exact parity may come and go as markets move.

The arrival of 'parity' throws into focus the substantial margins banks and other currency traders charge for their transfer services.

While Westpac will give you NZ$1 for each AU$1 you sell them via a telegraphic transfer, at the same time they will charge you NZ$1.0395 for each AU$ you want to buy. Transaction fees may also apply. Parity is still a way off on the bank BUY side.

 

as at this point in time: Retail Market Retail
7:45am, March 31, 2015 Bank BUYs mid-rate Bank SELLs
NZ$1 = AU$ ... TT   TT
    0.9815  
ANZ 0.9984   0.9652
ASB 0.9833*   0.9650
BNZ 0.9916   0.9594
Westpac 1.0005   0.9620

This is what our monitoring showed at 7:45am.

This is what the Westpac webpage showed at the same time.

At 8:15am, ANZ was at parity, while Westac had slipped slightly.

* = This is a commercial rate for cleared funds on NZD 100,000 and may not be strictly comparable to other bank rates on this page.

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13 Comments

We are also heading to parity with the CAD$.

Lets see how close to the Sun we can fly without burning our wings off.

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How about an interest rate hike? 

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 Commodity backed currencies are getting smacked as we get significant commodity falls due to lack of demand. NZ is small enough to slip under the radar.

 

 Why is demand for commodities collapsing?

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Exchange rates as offered by our retail banks have alwasy been a rort.  (and not news).  And as DC shows, if you do the transfer out and then back in, it's an amazing margin., for a transaction that has minimal processing cost for the bank. 

I am very frequently away from New Zealand.  This rort, is just one among many that show to me that our government values the corporates over the citizen.

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China using 100 years of constuction materials in just 3 years...

Prices pumped beyound fundamentals.  Now correcting.

Solt commodities like milk powered shouldnt be effected any where to the same extend (look at iron ore price graphs in US dollar term), a) you can only stock pile so much milk, and b) the rate of growth in sales of milk doesnt increase because u predict in 20 years anyother billion ppl with be urbanized in china (as was the case with constructing there ghost towns using aussy iron ore).

Tricky one to play as kiwi.  I think fundamentally we might have our dollar higher than theres for some time.  Great for some holidays.  Great for keeping immigrants using nz as a back door to au in the country so we can use there skills and demand here (just buy yourself a house already if you havent, not owning any property in a country like this is one of the financially MOST RISKY things you can do..  Don't buy in auckland, buy positively geared, land rich properties in the secondary cities.

My ASX based stocks are taken a hard currency hit though even though they've been going up.. will be holding off buying more even though the low AU $ is making it tempting...

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The Shanghai A Shares index is up 81 % in the last nine months fueled by margin loans and an explosion of retail stock market speculation.

The People’s Printing Press of China has been running red hot for more than two decades, and has fueled the most fantastic credit bubble in human history. Total credit market debt outstanding in China at the turn of the century was $2 trillion; now its 14X higher at $28 trillion. Even more fantastically, China’s nominal GDP has barely doubled—-from $5 trillion to $10 trillion since the 2007, but its credit market debt—-public and private combined—-has increased by $21 trillion, or by 4X the gain in money GDP.

This is downright monetary insanity, but in response to modest cooling of its construction frenzy, its chief central banker could think of only one thing: mooar ease!  Apparently, a 7X increase in PBOC’s balance sheet since the turn of the century is not enough—–even when it only adds fuel to the deflationary fires.

Needless to say, during the past year the signs that the China house of cards is tottering have become omnipresent. So this is where the doomsday machine comes front and center. China’s credit addicted financial system has just channeled the centrals banks liquidity to the stock market in response to Beijing’s attempts to administratively rein-in the shadow banking system excesses, and particularly, so-called “trust loans” to developers and commodity speculators.

Accordingly, the Shanghai A Shares index is up 81 % in the last nine months fueled by margin loans and an explosion of retail stock market speculation.

 

 

http://davidstockmanscontracorner.com/why-the-mania-is-getting-scary-ce…

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Who uses the banks these days for TTs? HIFX for example will give you a rate 50 pips off the interbank.

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Check out

 

Western Union AUD/NZD = $0.9901

 

National Australia Bank AUD/NZD = $0.9685 excluding fees

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It will be cheaper for Aussies to visit Tasmania than going to NZ's South Island.

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Just had a couple of Brits visiting after a month in Australia. They had a much better time in NZ, but they spent nearly double the pounds in the same time.

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Did they spend a month in Darwin or something?

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Also just back from AUS. Fuel is (always has been) a lot cheaper than in NZ, hotels and rental cars now too, due to the exchange rate. Holidays in NZ are becoming VERY expensive, yet that does not seem to deter a lot of people. The plane back was full of young people from Germany, Switzerland, Netherlands and except the Swiss they can see their Euros melt away as they travel. 

 

Good for New Zealand. We charge rip-off prices and people are still flocking here :-) ... who would have thought so just a few years ago. But, of course, NZ is in a different phase in its economic cycle relative to many other countries and times will re-balance the situation. Parity is not here to stay.

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Yus but thut's buhcuz Un Zul'n uss duffrunt.

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