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NZ dollar holds near record against euro

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Tue, 07 Feb 2012 9:52a.m.

The New Zealand dollar traded at 83.33 US cents up from 83.15 cents on Monday

The New Zealand dollar traded at 83.33 US cents up from 83.15 cents on Monday

The New Zealand dollar held near a five-month high against the greenback and near a record high versus the euro following renewed concerns Greece will default on its debt.

The New Zealand dollar traded at 83.33 US cents up from 83.15 cents on Monday. The kiwi dollar rose as high as 63.77 euro cents, the second-highest level since the currency entered circulation in 2002. It traded at 63.46 shortly after 8.30am.

Sentiment has deteriorated in Europe, with private creditors and Greek politicians yet to agree on terms of a 130 billion euro bailout.

Meetings have been postponed another day, irking lenders and prompting German leader Angela Merkel to demand that Greece's leaders fall into line.

If Greece defaults, "there would be a risk off scenario with the kiwi coming under pressure initially," said Stuart Ive, currency strategist at HiFX.

"Time is running out - with Greece stalling for another 24 hours."

The New Zealand dollar traded at 77.65 Australian cents up from 77.45 cents on Monday at 5pm.

The trade-weighted index advanced to 73.13 from 73.06.

NZN

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Comments

18 Feb 2012 06:48a.m.

Mike wrote:

Again, the NZ dollar isn't high. Its just the Euro is in such a mess it has lost more ground than the NZ $.

Our #1 trading partner is still Australia and since around 2000 we have gone from roughly $0.97 down to roughly $0.77 Australian - roughly 20% drop in the NZ $.

The EU is basically closed to NZ trading with so much restraint of trade we can't get in. NZ makes up around 4% of lamb production in the world, yet our lamb exports make up around 80% of lamb of the world trade as the world market is so restricted. Our Dairy production is under 3% of the world production and yet again, the amount we get into the EU is almost 0 as it is the most restricted market in the world. We hear how Japan, the USA, even China are hard markets to get into, yet they are much easier to get into than the EU.

Currently the EU is a mess with Greece, Ireland, etc and this has dropped the EU $ vs our own even though we have close to no trade there. We still have trade with the UK that goes back to post WWII agreements, and the EU has wanted to squash NZ access to the UK since before the Euro became the currency of the EU.

Before Kyoto Protocol the EU was being held by the WTO as breaching restraint of trade rules. Since Kyoto Protocol the EU has used Kyoto Protocol as an excuse to implement exactly the same restraint of trade, but under the guise of protecting the world, ie restrict trade and block likes of NZ from selling in the EU. This restraint of trade is worth trillions of Euro's to protected businesses in the EU and allowed likes of Greece to happen under this protection.

If look around the world there are few economies actually in a good state with too many that have been runing excessive social welfare - like greece, and for typically over 50 years. Even NZ we have too much drain on the economy with too few workers. NZ is about where Greece was 15 years ago and we need to do something about our problems and not just ignore them.