The NZD is rising on currency markets today, in advance of the release of our June quarter GDP growth data.
Athough most eyes are on the USD, it is our cross-rate with the AUD is nearly as important for both New Zealand housholds and businsses.
And it is here we find we are approaching parity, and probably much faster than many realise.
At I0 am today, banks were offering to buy AUD from you at almost parity.
In fact, if you are cash or travellers cheques, parity has already been breached.
Here are the telegraphic transfer rates from the four main banks:
NZD 1 = AUD ... | Bank SELL rate |
as at 10 am September 15, 2016 | T/T |
- ANZ | 0.9938 |
- ASB | 0.9945 |
- BNZ | 0.9929 |
- Westpac | 0.9989 |
So, if you have Australian dollars and want to convert them to New Zealand dollars, these are the rates that would apply at these banks,
and here is what one of them, Westpac, quotes in its online resource at the same time:
Westpac published BUY rates | Rate |
at 10 am, September 15 | |
- Westpac buys T/T | 0.9989 |
- Westpac buys travellers cheques | 1.0057 |
- Westpac buys cash | 1.0319 |
The irony is that most of the media attention is on the mid-rate - but that is a rate than no-one actually trades.
Buy and Sell rates are where trading takes place, and those rates depend on spreads. Bank spreads are often wide. Non-bank currency dealers like NZForex, HiFx and DirectFX can often trade at tighter spreads than banks. But banks too will quote more competitive rates if you negotiate with them. The higher the amounts involved, the more cometitive they will be. Amounts over $20,000 per trade get trader's attention, amounts over $50,000 will draw even sharper rates.
The following is a chart of mid-rates:
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