Forum Archive Index - September 2001

["hugh webber" <hugh.webber@clear.net.nz>]

The commentary I saw suggested that as NZ is an unknown
quantity to most international investors and in the current
international situation they are all for conservatism then
obviously the NZ $ will suffer. Air NZ's troubles as the national
carrier wouldn't help and also the half % NZ interest cut. But
good on ya Dr Brash, I for one am applauding.
Comments that its totally caused by linkage to a weak Aus
dollar are not quite on the mark as we even fell against the Aus dollar.
But its good for the NZ economy anyway - boost for NZ exports
and hence all soundly based NZ economic activity. Put the 
balance of payments on current a/c into surplus and enable us
to pay off some debt.

The US dollar is starting to show signs of a war footing. Mobilising
reservists, extra ships, patrolling jets, extra aid packages for Pakistan
and anti Taliban elements, a large aid rescue package for US airlines
all put Government pressure on the availability of funds and starts to push
up interest rates. As does the anticipated huge insurance payouts.
Besides that, the US as the largest and most modern economy, and the
only military superpower looks like a safe haven in times of trouble and
that props up the US $.
Given all these elements I don't think there's any mystery about it.
Besides Osama and Saddam need somewhere safe to put their money
don't they ;-).



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