English Says New Zealand Well Positioned to Grow as Kiwi Drops
“The high 70s against the U.S. would be comfortable for us,” English told Bloomberg Television in Singapore. “Our exporters have dealt with the headwind of a pretty high cross rate over the last four or five years, in the mid 80s. They have shown themselves to be resilient. What we need to see now though is profitability in our export sector.”
English is betting that gradual reduction in stimulus by Federal Reserve policy makers will raise U.S. interest rates and help the kiwi decline, regardless of expectations that New Zealand central bank Governor Graeme Wheeler will start to raise borrowing costs next year. The currency has gained 2.9 percent the past three months and bought 82.2 U.S. cents at 2 p.m. in Wellington.
“A fair bit of that effect is priced in, and we look forward to further positive developments as the Federal Reserve continues to unwind,” English said. “We’re in a pretty good position to benefit from any relaxation of pressure on the Kiwi exchange rate.”
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