Interesting Times For The Kiwi Dollar

You can see this against several other currencies, which we will have a look at in a moment.  First though, you might want to read this article from the Wall Street Journal - which gives a little insight into the New Zealand dollar and its current position.

Back on the 12th May the British pound was bagging 2.5246 Kiwi dollars.  Just three days later that had climbed to 2.5828.  But as we are now beginning to understand, the figures you see on your currency converter are very different from one day to the next – whatever currency is involved.

Here is another good example of this.  As the following Monday came to a close, the exchange rate was pegged at 2.5904.  But just twenty four hours later that had changed to 2.5599.  If you can’t keep up with these seesaw changes, don’t worry.  They do take some getting used to!  On that same Thursday the exchange rate had improved to 2.5914, before dropping back markedly to 2.5686 to close out the week.

By the 2nd June though, the rate had dived down to 2.5158, and while it had climbed to 2.5932 by the 9th, it was apparently on its way back down again at the time of writing.

So how has the Kiwi dollar been doing against other currencies?

Let’s look at the Euro.  On the 14th May it was being exchanged for 2.3066 Kiwi dollars, but that didn’t stay the same for very long.  By the following Tuesday it had dropped back to 2.2512, proving that big rises and falls were the domain of the New Zealand dollar, rather than the currency it was going head to head with.

The best figure that week was 2.2779, but by the time that week closed on the 22nd it was down to 2.2555.  More big swings were on the way though, as the Euro claimed just 2.1767 New Zealand dollars on the 2nd June.  It was back up to 2.2480 just two days later, while the week ending the 12th finished on 2.1893.  Can you keep up with all these changes?  It can get tricky as you go from one currency to another, given the volatility of the New Zealand dollar.

Let’s move on to the US dollar now, to see whether the pattern remains there too.

And indeed it does, as we would expect by now.  The 12th May finished on 1.6483, and that week finished up with an exchange rate of 1.7014 in the end.  What a difference there was between just a few days, and yet we are now getting used to seeing this kind of pattern in this situation.

The following week could not have ended any more differently than it did though.  By then, after a few swings and roundabouts to negotiate, the US dollar was bagging no more than 1.6143 New Zealand dollars.  You might have expected another upswing after that, but as it turned out that wasn’t going to happen.

The US dollar did climb up to 1.6265 Kiwi dollars a few days later, but it finished the month of May a little further back on 1.5700.  June didn’t get off to a good start though, as it was down to 1.5287 on just the 2nd of the month.

The US dollar did find its footing against the Kiwi dollar though, because that very same week ended on 1.5703.  You would think we’d be used to this pattern of ups and downs by now, but it still takes you by surprise!

A peak of 1.6109 on the 8th was knocked back to 1.5633 as that week came to a close, and we were left wondering where things would go from here.  Would we see more dramatic ups and downs to come against these and other currencies?  It seems likely that we will.

The main thing to remember here is that the Kiwi dollar has always been partial to keeping us on our toes.  This isn’t something that has been restricted to times of recession – it has always been there.  Quite why this currency above all others is so volatile is hard to detect.  But it certainly gives us something interesting to watch.