N.Z. Dollar Falls on Business Survey

The New Zealand dollar fell after a report showed business confidence dropped to a 17-year low in March.
TradingEconomics.com, Bloomberg 3/30/2008 6:18:14 PM

New Zealand's dollar is poised to snap three months of gains on speculation cooling economic growth may spur the Reserve Bank of New Zealand to lower interest rates.

The New Zealand dollar declined to 78.95 U.S. cents, the lowest in a week, before trading at 79.16 cents at 1:07 p.m. in Wellington from 79.74 cents late in New York on March 28. It dropped to 78.58 yen from 79.14 yen.

New Zealand's dollar headed for a third monthly decline versus the yen as a report last week showed New Zealand's annual current account shortfall was 8 percent of gross domestic product. A large deficit suggests a nation has to borrow more to meet its funding requirements, which have increased as investors flee credit markets, driving up the cost of debt.

Benchmark interest rates are 8.25 percent in New Zealand, which compares with 2.25 percent in the U.S. New Zealand's currency headed for a second quarterly gain, climbing 3.2 percent.

N.Z. Dollar Falls on Business Survey