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Not much change expected in NZ dollar

NZ Newswire logoNZ Newswire 11/12/2016 Sean Martin
New Zealand coin is arranged for a photograph in Wellington, New Zealand © Mark Coote New Zealand coin is arranged for a photograph in Wellington, New Zealand

The leadership of New Zealand is about to change but businesses aren't expecting much change the currency.

The latest ASB Kiwi Dollar Barometer survey has found businesses trading internationally expect the NZ dollar to be just below 70 US cents in 12 months' time.

Although that outlook hasn't changed significantly from the last quarter, larger companies expect to have greater foreign exchange exposure in the next year.

Also, 60 per cent of businesses said the level of the NZ dollar was more than 10 per cent unfavourable to their budget.

ASB chief economist Nick Tuffley says the NZ dollar has been elevated for some time which has benefited importers, but exporters may be feeling the pinch.

Importers are more upbeat than exporters on the NZ dollar's prospects, looking for some appreciation through to the end of the second quarter of 2017.

The local currency fell to 71.69 US cents on Friday from 72.10 cents on Thursday.

Interviews for the survey were conducted over three weeks ending August 1. During this period, the NZ dollar traded between 69.55 cents and 73.25c.

It was before Donald Trump was elected president of the US and before Prime Minister John Key signalled his intention to stand aside.

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