NZ dollar surges to record vs. Russian ruble amid escalating Ukraine tensions

Tuesday 4th March 2014

The New Zealand dollar touched a record high against the Russian ruble amid escalating tensions over control of the Ukraine.

The kiwi touched a high of 30.65 rubles overnight, and was trading at 30.56 rubles at 8am in Wellington, from 30.14 roubles at 5pm yesterday. The local currency edged up to 83.65 US cents from 83.53 cents yesterday.

The Russian currency plunged to record lows against the US dollar and the euro after Ukraine said Russia was building up troops along the border following Russian president Vladimir Putin's statement at the weekend that he had the right to invade his neighbour to protect Russian interests and citizens. The Russian central bank unexpectedly raised interest rates and said it has increased its involvement in the currency market, with traders quoted by Reuters estimating the bank spent US$10 billion yesterday to prop up the ruble.

"Uncertainty surrounding the situation in the Ukraine remains high," Kymberly Martin, markets strategist at Bank of New Zealand, said in a note. "The Russian ruble has dropped to all-time lows."

In New Zealand today, traders while be eyeing an ANZ report on commodity prices for February, scheduled for release at 1pm.

In Australia, the focus will be on the Reserve Bank of Australia which is expected to keep its benchmark interest rate unchanged at 2.5 percent and maintain its neutral bias.

The New Zealand dollar was little changed at 93.66 Australian cents from 93.67 cents yesterday.

Australia's interest rate decision is due at 4:30pm New Zealand time, following data on Australia's fourth quarter current account balance and January building approvals

The kiwi gained to 84.85 yen from 84.69 yen yesterday, advanced to 60.88 euro cents from 60.62 cents and increased to 50.20 British pence from 49.87 pence. The trade-weighted index rose to 78.55 from 78.39 yesterday.

BusinessDesk.co.nz

Comments from our readers

No comments yet