The New Zealand dollar dropped against the US dollar on Friday, while the Australian currency declined to the weakest level since September 1, after comments from Reserve Bank of Australia (RBA) Governor Glenn Stevens.
The New Zealand Kiwi dropped 0.36% lower to $0.8218 against the US dollar as of 6:44am GMT.
Manufacturing Rises
The manufacturing sector grew for the twelfth consecutive month on November, according to the BNZ-BusinessNZ Performance of Manufacturing Index, which showed the Index came in 56.7 in November.
RBNZ
The kiwi’s advance came after the Reserve Bank of New Zealand (RBNZ) hinted it would increase key interest rates to stay with the inflation target of 1% to 3%, the bank maintained its interest rates at 2.5% as forecasted.
“Annual CPI inflation increased to 1.4% in the September quarter and inflation pressures are projected to increase,” RBNZ Governor Graeme Wheeler said. “The extent and timing of such pressures will depend largely on movements in the exchange rate, changes in commodity prices, and the degree to which momentum in the housing market and construction activity spills over into broader cost and price pressures,” he added.
Australian Dollar
The aussie dropped to its lowest level since September 1, extending its decline against the greenback on Friday, following comments from RBA Governor Glenn Stevens.
The Australian currency slipped 0.16% lower to $0.8922 at the time of writing, and dropped 1.85% from the previous session’s high $0.9082 after the unemployment rate for the country was posted.
“To the extent that we get some more easing in financial conditions, at this point it’s probably more preferable for that to be via a lower currency at the margin than lower interest rates,” Stevens said.
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