ASB's Kiwi Dollar Barometer:

  • Survey's exporters', importers' and importer/exporters' businesses with annual foreign exchange turnover of at least NZ$1 million
  • Surveys businesses' expectations for the NZD/USD
  • And business hedging plans

For December, the Key "take-outs"

  • A clear turnaround in NZD sentiment was evident

Respondents significantly revised down their NZD/USD outlook

  • Now expect the NZD/USD to average 65.9 cents by Q4 in 2018, which compares to a 12-month outlook of 75 US cents just three months ago
  • Respondent groups have a similar outlook, irrespective of their trade focus or size of operation

An increase in hedging intentions, with the 84% of respondents planning to hedge exposures the highest in the close to four-year history of the survey

  • There were differences by trade orientation, with the lower NZD reducing hedging intentions for exporters (52.4%), increasing intentions for importer/exporters (at 97%, the highest on record), with those for importers steady at around 90%.
  • For those enterprises that plan to hedge, the cover is equivalent to 93.7% of FX exposures, the highest on record