New Zealand's currency weakened for a seventh day, the longest run since Aug. 17, as the report added to signs economic growth is slowing, strengthening the case for the central bank to lower interest rates.
The New Zealand dollar slumped to 75.57 U.S. cents as of 1:46 p.m. in Wellington from 76.08 cents late in Asia yesterday. It earlier reached 75.56 cents, the weakest since Jan. 24. It may decline to 75 cents today, Morriss forecast. The currency fell to 79.40 yen from 80.03 yen.
Retail sales slumped 1.2 percent in March from the previous month when they declined a seasonally adjusted 0.6 percent, Statistics New Zealand said today in Wellington.
Traders are betting the Reserve Bank of New Zealand will cut its 8.25 percent benchmark rate by 127 basis points in the next 12 months, compared with 125 basis points yesterday, according to the Credit Suisse Group index based on interest- rate swaps.
The decline in consumer spending added to reports on employment and housing released this month that suggest economic growth almost stalled in the first quarter. Companies cut 28,000 workers in the first three months of 2008, the most in 19 years, while house sales in April fell to a 16-year low.