New Zealand dollars hits 15 month low

The New Zealand dollar touched a 15-month low Monday after data showed that the country's central bank sold large amounts of the currency in August, increasing expectations of further intervention.

The Reserve Bank of New Zealand sold a net 521 million New Zealand dollars (US$406.4 million) in August--the most since July 2007 and significantly more than the NZ$2 million it sold in July this year, data released by the central bank showed.

The currency fell sharply after the data's release, touching US$0.7708--its weakest since late June 2013--from around US$0.7828 just prior to the release.

The central bank "put its money where its mouth is" by selling the currency, ASB Chief Economist Nick Tuffley said. "We don't rule out further tactical actions from the RBNZ to keep downward pressure on the New Zealand dollar."

The RBNZ has said on several occasions that the New Zealand dollar, known as the kiwi, was unjustifiably strong even given the country's relatively strong economy. Market participants have interpreted the statements as indications that the central bank was prepared to intervene to weaken the kiwi.

Prime Minister John Key, a former currency trader, earlier said he supported the central bank intervening in the market, suggesting the New Zealand dollar should be around US$0.6500.

The kiwi's strength is largely the result of a relatively strong economy that has outperformed those of most other developed nations since the global financial crisis. The South Pacific nation, with a population of just 4.5 million, has benefited from booming Asian demand for its meat and dairy exports, and the pace of its economic growth is now at a 10-year high.

New Zealand is also among the few countries to have begun a cycle of interest-rate increases--four so far this year--helping fuel demand for the Kiwi.

Still, cracks are starting to show in the economy. Among the biggest concerns is a sharp decline in prices of dairy, the country's largest export sector.

Theo Spierings, chief executive at dairy giant Fonterra Co-Operative Group, said any fall in the New Zealand currency was going to help exporters.

Source: marketwatch.com

Dollar Near Four Year High

US Growth Supports Fed Prospect and because of that Dollar Near Four-Year High!

A gauge of the dollar against 10 major counterparts was near the highest in four years as an improving US growth outlook adds to expectations the Federal Reserve is moving toward raising borrowing costs next year.

The US currency has risen versus all of its 16 most traded peers this month as the Fed stays on track to end its bond-buying program, known as quantitative easing, in October. The yen headed for its first weekly gain since the start of August as the US expanded its bombing of Islamic State militants from Iraq to neighboring Syria, spurring demand for the Japanese currency as a haven.

"The strong dollar trend across the board is continuing," said the trader at Union Bank NA in Los Angeles. "The Fed is on track to end QE in October and is likely to raise rates by middle of next year as planned, while we haven't seen much improvement in other nations."

The Bloomberg Dollar Spot Index, which tracks the US currency against 10 major peers, was little changed at 1,061.60 as of 8:41 am in Tokyo after rising to 1,062.75 yesterday, the highest close since June 2010.

 The dollar bought 108.53 yen from 108.75, after reaching 109.46 on Sept. 19, a level not seen since August 2008. The yen has gained 0.5 percent against the greenback this week. The US currency was little changed at $1.2757 per euro after gaining to $1.2697 yesterday, the strongest since November 2012.

The US gross domestic product grew an annualized 4.6 percent in the second quarter, more than the previous estimate of 4.2 percent released Aug. 28, according to a Bloomberg survey of analysts before today's Commerce Department report. The Thompson Reuters/University of Michigan final consumer sentiment index rose to 84.8 this month, the highest in more than a year, a separate Bloomberg survey projected.

Source: bloomberg.com

The Richest Person in China

The largest stock offer in history has made Jack Ma, founder of e-commerce giant Alibaba, China's richest person with a fortune of $25 billion, an annual wealth ranking in the world's second largest economy showed Tuesday.

"It has been an amazing year for China's best tycoons despite the jitters about the Chinese economy," said China-based luxury magazine publisher Hurun Report in its annual rich list.

Ma reaped more than $800 million selling shares in the company he set up 15 years ago as Alibaba listed on the New York Stock Exchange Friday, based on company filings, with the value of his remaining stake of 7.8 percent surging to more than $17 billion by Monday.

Last year, the estimated wealth of the former English teacher turned Internet entrepreneur was just over $4.0 billion, which did not even place him in the top 20.

Alibaba's listing raised a total of $25 billion.

But only one other Alibaba co-founder, now vice president of its China investment team Simon Xie, made the rich list, Hurun Report said.

Property tycoon Wang Jianlin, whose Wanda company bought US cinema chain AMC Entertainment, dropped to second place from first last year with a fortune of $24.2 billion as the deflating of China's real estate bubble chased most developers out of the top 10.

A new face, Li Hejun of renewable energy firm Hanergy, tied for third place with $20.8 billion, alongside beverage magnate Zong Qinghou of Wahaha.

Completing the top five was Pony Ma of Tencent, operator of China's most popular instant messaging application WeChat, with $18.1 billion.

Technology commanded half of the top 10. Robin Li of China's dominant search engine Baidu was sixth; Richard Liu of Alibaba competitor JD.com took ninth, and Lei Jun of upstart mobile phone producer Xiaomi was 10th.

Rounding out the top 10 were father and son team Yan Jiehe and Yan Hao of road-builder China Pacific Construction in seventh position and another real estate mogul, Yan Bin of Reignwood in eighth.

China's real estate and infrastructure industries have been hit by the slowing economy.
The economy grew an annual 7.7 percent in 2013, the same as in 2012 -- which was the slowest rate of expansion since 1999. Gross domestic product growth was 7.5 in the second quarter this year.
Still, Hurun Report said the number of US dollar billionaires in China hit 354 this year, up 39 from last year.

Source: yahoo.com