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New Zealand Dollar Expected to Buy after RBNZ Seeks to Change Airline Carrier Policy | Instant News


Pine wood is exported from Wellington, New Zealand. Photo by James Anderson, World Resources Institute.

  • GBP / NZD spot rate at time of writing: 1.9257
  • Bank transfer rate (indicative guide): 1.8482-1.8616
  • FX specialist provider (indicative guide): 1.8865-1.8980
  • More information on specialist FX rates here

The New Zealand dollar remains the week’s best-performing major on Thursday and is expected to be bought Westpac after Reserve Bank of New Zealand (RBNZ) hints at a pending shift in the interest rate guide, potentially removing what has been a major hurdle for the Kiwi of late.

RBNZ policymakers have been warning for months about an impending shift to negative interest rate policy, while also threatening to put a big sale on the Kiwi Dollar in the market to dominate the exchange rate by buying foreign assets, although the November policy update brought about a change in tactics.

“Global sentiment has been positive lately, capping the US dollar. But the NZD has also outperformed all major currencies. NZ economic performance during the Covid recovery is one explanation, with other easing expectations for OCR cuts,” said Imre Speizer, chief strategy officer. NZ at Westpac. “The MPS RBNZ yesterday provided more easing through the FLP scheme.”

The New Zealand government has contained the coronavirus faster than others and prior to the pandemic had one of the lowest debt-to-GDP ratios in the developed world, leaving the RBNZ’s policy stance looking incompatible with other central banks as well. -than the reality expected on the ground in New Zealand.

The discrepancy was recognized on Wednesday when the RBNZ raised its forecast for the exchange rate by about 130 basis points for September 2021, suggesting that interest rates are no longer likely to fall as far below zero as was once envisioned, which had been supports the ongoing rally in the Kiwi exchange rate.

Above: NZD / USD rates are displayed at hourly intervals next to S&P 500 index futures (black line, left axis).

Governor Adrian Orr said Wednesday that international and domestic demand proved tougher than expected, before picking the domestic job market and household spending power recently to praise. The bank still expects “very large and persistent” shocks to keep employment and inflation below target levels for years, but less than the August policy update, suggesting lower support may now be needed.

“Members discussed inflation and employment prospects. Staff presented a basic scenario, conditioned on a number of assumptions, including that there is no longer a substantial outbreak of the COVID-19 community in New Zealand, and that international borders will be fully opened by 2022. In this scenario, markets The workforce is projected to weaken further in the near term. It is projected to recover over the next years, particularly once borders are assumed to be fully reopened, “said RBNZ. “Inflation is projected to fluctuate around the bottom of the Committee’s target range of 1 to 3 percent.”


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GBP / NZD forecast

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This, the progress towards a coronavirus vaccine and a possible change of leadership at the White House in January, all reduce the barriers facing the New Zealand Dollar, and potentially allow it to continue to outperform over the coming months. The US election result is a prospective advantage for the Chinese economy, which is New Zealand’s biggest trading partner, while a successful launch of a coronavirus vaccine will be a game-changer for the global economy and could also be key to reopening New Zealand’s borders early.

As a result expectations for the Kiwi Dollar weakness have eased and the RBNZ’s anxiety over future strength is deemed unlikely, while both have played a role in Westpac’s advocacy that bank clients are betting on an almost 5% increase in weighted trading. New Zealand Dollar over the coming months.

“Today we have more positive economic news – another very strong housing market update, which will keep the story of New Zealand’s economic performance alive for a while,” said Speizer.

Above: Currency weighting for the New Zealand Dollar exchange rate by trade. Source: RBNZ.

The Westpac notion implies a rise in the Kiwi against the Aussie, US Dollar, Japanese Yen, Pound Sterling and Euro, which collectively account for around 55% of the trade weighted index. Other exchange rates that are likely to rise include NZD / KRW and NZD / CNH, which are worth around 25% of the index.

“The RBNZ is slowly marking their exaggerated pessimistic forecast to the market as the story on the ground is bullish while the story in their Monetary Policy Statement remains grim. They are trying to change the carrier monetary policy slowly to avoid sending NZD to the month while still admitting all the new positive information,” said Brent Donnelly, a spot FX trader at HSBC. “I think this sets up an eventual acknowledgment that negative interest rates are the last thing the New Zealand economy needs.”

Donnelly said the RBNZ developed its forecasts to fit reality after the housing market exploded amid the pandemic and although New Zealand’s national borders remain closed for a period that can be extended to the end of 2021.

The resilient job market also surprised investors, traders, analysts and policymakers, with the unemployment rate rising only to 5.3% in the third quarter, the highest since the last quarter of 2016 but remaining below the 7.3% peak seen during the recovery from the crisis. financial 2008.


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GBP / NZD forecast

Point: End-2020 – Q3 2021
Detail: Consensus institutional estimate target + target max & min.
Contributors: Citi, Barclays, Morgan Stanley & others
Giver: Global Reach Partners
Type: Free download

Please Access Here

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Point: 2021
Detail: Hedge means, Market Orders,
What a currency broker can offer your business.
Can be followed up: Free FX review
Giver: Global Reach Partners
Type: Free download

Please Access Here

Parts of New Zealand experienced a second but short-lived lockdown in the last quarter while the nation’s entire tourism industry, which although valued at around 6% of annual GDP, has remained in lockdown during this time but despite this the rate of job loss has resulted in a smaller increase in unemployment.

While RBNZ policymakers may not now need to go as far as they suggested recently, this could also see New Zealand maintaining best-in-class national balance sheets as well as offering investors bond yields that remain higher than those in many other major economies.

This, in an environment where other nations’ national balances are already bloated and still deteriorating at a rapid rate while their central banks squeeze returns to investors in the bond market, has the potential to be a recipe for continued New Zealand Dollar strength. .

“The next employment data is very important,” said Donnelly. “I still like AUDNZD lower but I modified my parameters a little bit because of the big drop. I lowered my stop loss to the entry point and will try to buy half back at 1.0557.”

Above: NZD / USD rates are shown at daily intervals along with the AUD / NZD rates (black line, left axis).


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New Zealand Dollar Aims Higher but US Voice, Key to RBNZ’s Decision for Outlook | Instant News


– NZD outperforms risk assets as Americans head for the vote.
– Voting begins, US elections dominate ahead of New Zealand jobs data.
– USD response, key RBNZ policy for NZD short term outlook.

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  • The GBP / NZD spot rate at time of writing: 1.9464
  • Bank transfer rate (indicative guide): 1.8783-1.8919
  • FX specialist provider (indicative guide): 1.9172-1.9289
  • More information on specialist FX rates here

The New Zealand dollar rose on Tuesday as investors pursued riskier assets in anticipation of a Democratic Party clean win in Tuesday’s presidential election, which is just as important for the outlook as the Kiwi jobs report looms ahead of next week. Reserve Bank of New Zealand (RBNZ) policy decisions.

The New Zealand dollar rose against major currencies including the Dollar and Pound as polling stations opened in the US and investors stood firm on the back of bets implying that a Democratic ‘purge’ in both the house of Congress and the White House was the most likely outcome of the vote.

“The outcome of that event will determine the direction of NZD / USD in the near term, with the NZ employment data likely taking a back seat,” said Imre Speizer, chief NZ strategist at Westpac. “We maintain a positive outlook, targeting 0.6800 by year end, expecting the USD to weaken amid increasing risk sentiment.”

Pollster and analysts generally view Democratic candidate Joe Biden as a presidential candidate, while investors are betting big that President Donald Trump will be ousted from the White House once Americans vote there.

Markets may face days of tense waiting before actual results are confirmed although individual states will start announcing their results in the early hours of Wednesday morning and in New Zealand’s third quarter jobs wages report, which is expected to reveal a sharp rise in unemployment.

“The weakening New Zealand labor market conditions will reinforce expectations for additional RBNZ easing next year and limit NZD / USD strength. Our ASB counterparts project New Zealand’s unemployment rate to rise to 5.5% in Q3 (consensus: 5.3%) of 4.0% in the previous quarter, “said Elias Haddad, strategist at Commonwealth Bank of Australia. “The uncertainty of US elections and the possibility of a more severe setback for the global economic recovery will continue to support the strengthening of the USD in the near term.”

Above: NZD / USD is displayed at daily intervals with S&P 500 index futures (yellow line, left axis).

The consensus is looking for New Zealand’s unemployment rate to have increased from 4% to 5.3% in the last quarter, which analysts and economists say emphasizes the RBNZ’s need for the economy for sustained intensive monetary support. The RBNZ will announce its next policy decision on Wednesday November 11 and has prepared the market to expect interest rates to fall below zero next year, but whether the Kiwi maintains an upward bias will be determined largely in the short term by the US. election.

“The market is likely to return to looking at those numbers once the dust over the US election has subsided,” said Francesco Pesole, a strategist at ING. “While the NZD is set to be another beneficiary of a potential big win by Joe Biden (and one of the main losers if Trump wins), the short-term overvaluation (according to our fair value model) and the suggestion of an excessive net-long position is a rather upside potential. less compared to its closest counterpart, AUD. ”

RBNZ’s jubilant approach to rate cuts and quantitative easing has kept NZD / USD pinned below 0.68 since the start of its recovery rally in March, while a bearish market outlook against the US Dollar has seen the Kiwi support above 0.65, making for range bound trading months.

GBP / NZD forecast

“NZD volatility is also likely to remain high this week as the RBA and US election results weigh on the NZD. Biden’s win could provide modest support for the NZD if risk sentiment improves,” said Nikolaos Sgouropoulos, strategist at Barclays.

The outcome of this election will be the difference between whether the US Dollar resumes six months of decline or slumps higher as short sellers are squeezed by either President Donald Trump’s surprise re-election, or a result still too close to call for the length of time it will take to count votes by post. that has never happened before.

“It is very likely that Donald Trump will be re-elected today, but very unlikely,” said Ian Shepherdson, chief economist at Pantheon macroeconomics. “Our base case has for some time been a sweep of blue, with Mr Biden winning comfortably, Democrats holding 50 to 52 Senate seats and retaining, at least, their strong majority in the House. Yesterday, non-partisan cooks final rating of the report. suggests that Democrats will increase their majority by 10 to 15 seats. Under current rules, Democrats will not have enough votes in the Senate to pass budget laws that increase spending but don’t increase revenue, without Republican support. ”

Above: NZD / USD is displayed at daily intervals with S&P 500 index futures (yellow line, left axis).

“NZD / GBP is technically neutral and in a very well established range,” said David Croy, strategist at ANZ.

Anything other than a decisive victory for the opposition candidate could make a contested election more likely, speculation suggests, while President Trump has only encouraged this view by continuing to make accusations of fraudulent play relating to the postal voting system. He criticized over the weekend the Supreme Court’s decision to allow ballots marked on election day to be counted days after the actual ballot in Pennsylvania, alleging this could facilitate fraud by opposition activists.

“The NZD is surprisingly resilient, in our view, given the deteriorating macro backdrop as COVID19 spreads through Europe and the US, as risk appetite has taken a more cautious tone ahead of the US election,” said Ray Attrill, head of FX. strategy on CATCH. “We can imagine some NZD volatility ahead, with the NZD walking softer into the US elections, bouncing higher on any post-election USD selloff, and then weakening again as the RBNZ statement gives traders little reason to buy NZD.”

Investors may have underestimated the possibility of a marginal victory by Biden who was later challenged in court, causing weeks of uncertainty, and have paid scant attention to the idea that President Trump could be re-elected. Both results could force investors to move away from, or at least reduce bets against the Dollar, which would lift the greenback and weigh on exchange rates such as NZD / USD.

The kiwi is one of the biggest losers from Donald Trump’s re-election given New Zealand’s close relationship with the Chinese economy which could be subject to ongoing or even new US tariffs during Trump’s second presidency. The prospect of a continuing trade war between the world’s two largest economies will lift the safe-haven Dollar and by implication, weigh on commodity currencies such as the Kiwi.

“Dem’s sweep should generate a relief rally in risk, but the focus will soon shift to the growth impact of the current second wave and perhaps more importantly, how aggressively Biden is pursuing well-publicized corporate tax increases, so I’m not sure how long it will take. the relief rally will persist, “said a trader at the London deals desk at JP Morgan in remarks Tuesday morning. “Trump’s win and we only buy USD.”

Above: NZD / USD is displayed at daily intervals with the US Dollar Index (yellow line, left axis).


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Away From The Busy World At Sils Maria In Switzerland | Instant News


Time seemed to stop at Sils Maria. Located on the border between Tyrol and Italy, at the far end of the spectacular Engadin Valley in Switzerland, especially in Upper Engadin are Sils Maria – or Sils for initiates – at an altitude of 1,800 meters above the sea on the top of Europe. The small village – as beautiful in summer as it is in winter – sits between Lake Sils and Lake Silvaplana at the foot of Piz Corvatsch and below Val Fex, a valley to the south. It is part of the Maloja Regency. Enchanting. Nature in its purest beauty. Unlimited perspectives and fresh air: the supreme luxury of the century. Summer meteorological phenomena surround glacial valleys chiseled in rock, streams of snake-like clouds that navigate from Sils Maria to Silvaplana. Interesting.

It’s impossible not to think of German philosopher Friedrich Nietzsche when you come to Sils Maria. There you understand the inner power of this place, its purity and greatness. Friedrich Nietzsche spent the summer of 1881 and lived between 1883 and 1888 in the small village. Nietzsche’s house it is now a small museum in the village next to the Hotel Edelweiss where she is delighted to have her food. It is well known that in his last and most important creative years, Nietzsche had an intensive relationship with Sils Maria. In his letter to musician friend Peter Gast on 8 July 1881 he wrote of Sils: “loveliest corner on earth: I have never been in a more peaceful environment and all 50 of my poor living conditions seem to be fulfilled here. “ In another letter to him on July 1, 1883 Nietzsche wrote “now I am back to meet my beloved Sils Maria in Engadine, a place where one day I want to die “.

At Sils Maria, Nietzsche feels at ease and his inner world seems to be reflected around him. He loved Sils Maria more than anywhere else in the world. He worked for months in a small, simple room – reduced to his basic needs – with enormous creative power and scarce concentration. Nietzsche walked for hours every day. In another letter to Peter Gast on September 3, 1883 he said: “This Engadin is the birthplace of my Zarathustra. I have just come across the first outline of my thoughts regarding work; below it is written Early August 1881 in Sils Maria, 6000 feet above sea level and much higher above all human attention “. It was in this extraordinary place that he got the idea of ​​Eternal Eternity in Lake Silvaplana, near the pyramidal rock of the road between Sils and Silvaplana / Surjlev and with this and the idea of ​​Superman he reached the basic conception of his course. work “So Speak Zarathustra “.

Inside the house, photos of Anne Frank, Hermann Hesse and Thomas Mann, Pablo Neruda, Boris Pasternak, Marcel Proust who also visited Sils Maria. The list of personalities that have come here is long over the years and still growing. The search for limitless beauty and serenity is what you find at Sils and why you always want to return.

One of the unique locations in Sils Maria is The Waldhaus hotel which means “house in the forest”. The Waldhaus -with its towers and crenellations- looks like a castle overlooking the village of Sils and offers 360 ° views east to Lake Silvaplana, west to Lake Sils, north to the Sils plains and south to the Valley of Fex. Fairytale scenery.

Since the opening date of 1908 – the hotel has remained in the same family and is now managed by the fifth generation brothers Claudio and Patrick Dietrich who will greet you at check-in and talk to you in the evening at the restaurant. A family and genuine atmosphere with strong hospitality values. What also makes this hotel different are the guests who have stayed here for years. Author Herman Hesse spent a total of 370 days and nights at the Waldhaus.

In 1905, founders Josef and Amalie Giger believed they had found the perfect location for their hotel and engaged the famous architect Karl Koller (1873–1946) to design it. She designed the hotel to be “beautiful, practical and sturdy”. Every year the family renovates the hotel. The hotel ‘s 140 rooms and suites – all different – have been beautifully furnished and restored to their original state. Inside the hotel, very special items are placed here and there, such as the original Welte-Mignon piano in mahogany with Royal bronze keys – purchased by the family in 1910 – with a very intricate mechanism still functioning properly.

The dining experience is a specialty at the Waldhaus, you can choose half board or eat à-la-carte at the time of booking. Whatever your choice, both are great. The food at the Waldhaus excels in regional and seasonal cuisine. They work with organic farmers from Filisur in the Albula Valley and local craftsmen in Engadine. The breakfast buffet is impressive ranging from fresh local Swiss milk and yogurt to honey or Zöpf – a delicious traditional Swiss brioche – the kind of buffet that is really hard to find anywhere else.

Carla Lehner-Dietrich, sister of the owners, sisters Claudio and Patrick, runs a 1400 square meter spa that opened for the 2016/2017 season. A temple of serenity that blurs the line between the inside and the outside. Impressive ceiling lights bring natural light into the large rooms and the walls are decorated with crystal glass mosaic tiles. A spacious sauna, two steam baths, cembra pine and larch pools, gym, indoor pool, outdoor whirlpool and seven treatment rooms. Renowned Austrian spa specialist Susanne Kaufmann curation treatments for the Waldhaus Spa. The products are all produced from alpine plants and are also in every room and suite. The spa’s architecture fits perfectly into the overall design of the hotel and around the rock and larch pine forests.

The Waldhaus is one of the legendary hotels where you find true serenity and peace, away from the bustling world. Always think of future happiness for your next visit.

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Geneva, Switzerland will have the Highest Minimum Wage in the World | Instant News


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Residents of the canton of Geneva (Switzerland) voted in a referendum on September 27, to pronounce in favor of a minimum wage of 23 Swiss francs per hour (25 dollars), the equivalent of about 4,450 dollars per month, thus reaching highest monthly salary in the world .

About 58% of voters support the new measure, which will take effect in mid-October and will benefit 30,000 employees in the region. Michel Charrat, president of Groupement Transfrontalier Européen , an independent organization supporting workers on the Franco-Swiss border, called the vote a “ sign of solidarity ” with the urban poor, who are considered one of the best places in the world to live.

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“ COVID-19 has shown that certain sectors of the Swiss population cannot live in Geneva, ” Charrat said explaining that it is more than 4,000 Swiss francs is the ” minimum to avoid falling below the poverty line ”.

According to Swiss media, the Coronavirus Pandemic provided a decisive impetus for this initiative, which Genevans had rejected in two previous consultations, in 2011 and 2014.

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The Australian and New Zealand Dollars Are Paying Today for Huge Economic Stimulus When Borders Reopen | Instant News


Above: RBA Governor Philip Lowe on the podium (left). RBNZ Governor Adrian Orr on the podium (rigth). Separate event. Image File © Pound Sterling Live. Other Images © NZ Financial Services Council, Reserve Bank of Australia.

The Australian and New Zealand dollars rose broadly in the last session of the week even as they paid for the costs of continuing international border closings, but next year the reopening of a devastated domestic tourism sector provides the antipodean economy, and currency, with a final 2021 shot in the arm.

The Antipodean dollar strengthened on the greenback and other major rivals on Friday amid a clear upbeat mood among investors whose appetite for risk assets lifted stock and commodity markets, while supporting closely linked currencies.

However, the gains were modest, and the performance of both of them weakened during the week after the Kiwi was hampered by Reserve Bank of New Zealand (RBNZ) spoke of negative interest rates while the Aussie gave an uncertain response from Treasurer Josh Frydenburg’s 2021 federal budget.

There is no wound that deprives either of the two currencies from their nascent uptrend against the US Dollar and others including the Sterling, an uptrend that has increasingly attracted scrutiny from central banks, which fear it will hamper export competitiveness and recede inflationary pressures.

Uptrends may last for a while, but if Frydenberg and his New Zealand counterpart Grant Roberston are right in assuming that until the end of next year, both countries will remain closed to travelers and tourists from the outside world; both were usually significant contributors to the pre-coronavirus economy.

Above: GBP / AUD, GBP / NZD (orange line, left axis) at daily intervals, pushed to 2020 lows in September amid weaker Sterling and a strengthening antipodean currency.

“Australian bonds continue to be purchased by global, yield-seeking investors as well as by local ADIs under bank liquidity regulations and by the domestic fund management community for benchmarking purposes. The question is whether they will continue to do so despite record low absolute yields, “said Damien McColough, head of Australia’s interest rates strategy at Westpac, following Tuesday’s budget. “We think they will, in relative terms, the AU results continue to represent a value based” reward for risk “versus the global alternative.”

Below-average debt-to-GDP ratios for major developed economies have made antipodean usually higher yielding government bonds particularly attractive to international investors who have all fallen short as a result of the pandemic. Especially when combined with superior virus containment at home and the plight of the world in other parts of the world.

This has been the main driver of the ongoing demonstration by anti-coded currencies, which initially led to complaints from Reserve Bank of Australia (RBA) and RBNZ, although this is turning into a threat of policy action with New Zealand’s more vocal and most proactive central bank.

RBNZ staff said at a closed briefing this week that they would rather do too much and too fast for the economy than too little and too late, before confirming that preparations for implementing negative cash values ​​are underway while hinting that actual implementation of one is likely.

Above: Australian and New Zealand Dollars look against their major peers in 2020. Source: Pound Sterling Live.

“If the RBNZ delivers negative policy rates, New Zealand will be the first economy with negative policy rates and current account deficits. There is no precedent for this combination and its ability to provide currency weakness, “said Joseph Capurso, strategist at Commonwealth Bank of Australia in a recent review of the bank forecast. “The upcoming US election is a downside risk for our NZD forecast in our view. Similar to [AUD], President Trump’s victory could weigh on NZD / USD (in our view, Trump’s victory in favor of USD). However, as President Trump’s policies are unlikely to be as radical as 2016, NZD / USD weakness will be short-lived. “

A negative exchange rate might weaken the New Zealand Dollar in 2021, but investors have predicted a cash rate of -0.15% for April and an exchange rate of -0.19% for the end of 2021 so that such a policy pivot may already be reflected in the exchange rate . .

This in itself is reason to expect the RBNZ to follow through on its threats, as not doing so will only risk further currency strength, which neither the RBNZ nor the RBA want to see.

At the moment, the uptrend risks persisting into next year if markets are right about the Democratic Party’s victory in November’s US election. It is intended to sink the US Dollar into the next year. But the real impact for both central banks and a possible gain for the Dollar two further is that the uptrend, if not disturbed beforehand, could be pushed further into late 2021.

Above: AUD / USD, NZD / USD (orange line, left axis) at daily intervals, pushed to 2020 lows in September amid weaker Sterling and a strengthening antipodean currency.

“The unemployment rate is expected to reach 8 percent in the December 2020 quarter, reflecting the obstacles from the ongoing closure of international and domestic borders, continued social restrictions in Victoria, ongoing restructuring of businesses and the impact of increased participation, before dropping to 6½ percent. in the June 2022 quarter as economic activity recovers, “Australian treasurer Josh Frydenburg said in Tuesday’s federal budget.” The gradual return of international students and permanent migrants is assumed until the end of 2021 (with a small, phased pilot program starting international students returning from late 2020). International travel in and out is expected to remain low until the end of 2021, after which a gradual recovery in international tourism is also assumed. “

The currency’s rally could increase if the Australian and New Zealand borders remain closed until the end of 2021, as the two countries typically earn a significant share of GDP in the tourism sector.

New Zealand statistics the word Kiwi industry attracted 5.8% of national GDP in 2019 interim that Australian Bureau of Statistics the word Its contribution to the economy was lower but still stands at 3.1% last year.

GDP data for August was confirmed on Friday that it was easy to pick the disadvantages of the UK’s economic recovery before the end of the third quarter, while quarterly growth in the rest of the world is expected to slow significantly in 2021 for the same reasons, with the rest losing output potentially taking time years to recover.

But Aussie and Kiwi growth could be augmented by the end of 2021 onwards with borders reopening, especially if markets are betting right a vaccine will soon be found and if this leads to a broader recovery in global travel.

In a world of relative and forward-looking foreign exchange rates, the prospect of this form of purchased and paid stimulus delivered by the end of 2021, against a backdrop of a slowing global economy, could be a strong argument in support. antipodean currency next year.


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