One thing that nobody seems to have mention is the fact it's only the US$ that is currently weak and that not everything we import into NZ or export is paid for in US$. Against the UK Pound Stirling we're currently around .37, .55 to the Euro and .89 to the Australian dollar. All of these values are pretty typical of where they have been for the past 3-4 years.
Australia is NZ's largest export market, followed by Japan and then the EU. Export or Import deals to most of these countries will typically be paid for in local currencies. If they are paid for in US$ it will be a conversion from local currency to US$ therefore the value of the US$ is irrevelent.
According to the media people are also rushing to book overseas holidays because of the strong NZ$? Maybe if you're heading to the USA this is a good time to go but for the bulk of us who to go Australia or Euope there is virtually no difference between now any any time over the past few years.
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Comment by lugh, on 20-Apr-2007 12:38
I understand the pain of the exporters but not when they say our economy is being hurt because they're not introducing new money into the market. When our dollar goes nuts like this, we get more overseas investors, further swelling our dollar. Isn't their money piling into the market and, if so, more than exporters?
Comment by taniwha, on 20-Apr-2007 15:18
time to do a bulk threadless order methinks
Comment by numfarr, on 21-Apr-2007 08:45
The NZD has been overvalued for the last 3 years at least. This graph shows the relative positions of the currencies over the last 14 years. While the GBP and EUR aren't doing as badly as the USD, they are still off 10% against the NZD over the last year and in the lower part of their range, at a time when with our huge external deficit and dismal savings rate they should be a lot better. The market is basically ignoring the risk in favour of short-term gains, for now anyway.