Genesis

From what I can glean the dollar may be on the wane. Analysts say that in reality when all factors are taken into consideration the kiwi should be at 70US cents not 81/82 as it presently stands. Commodity prices are on a downward movement and Australia is certainly not going where it would like to. With respect to the latter one pundit put it "where Oz goes NZ goes" so it looks as if things may be coming off the boil which in turn will make our pounds buy more kiwis as all the aforementioned pressure pulls the kiwi back to its more appropriate value. Only time will tell.

florabundi

Trying to keep a close eye on this. I've not made any transfers yet...

Charismatic

But when will the recession be over?

Genesis

15 MAYBE 20 YEARS?

Charismatic

Careful what you wish for Genesis as it just might come true!

RBNZ Inflation rate targets are 1-3% in the medium/long term (since 2002).

RBNZ reports second quarter inflation rate is 5.3% and it's not been under 4% since the beginning of the year.

The high dollar is one of the few things keeping inflation under control. Now that is falling.

RBNZ may have to increase their cash rate upwards from 2.5%, last time inflation was at 5.1% (so slightly lower than it is now) the cash rate was set at 8%.

Only likely to change to 3-3.5% of course for now, lets hope that inflation rate gets the rate back under 3% by the end of the year or RBNZ may have to really bring the pain to mortgage holders in early 2012 .

Genesis

I don't wish it, I don't wish much these days. The world economy is utterly bollocksed. Even the one that could do no wrong has gone bent (Oz). Times are bad. They reckon 2012 is going to make 2011 look like a REALLY good year!

Charismatic

It makes you wonder how incompetant a government has to be to run a perfectly good economy into ruin within a couple of years.

DC10

UK inflation = ~ 5%
Bank of England official interest rate = 0.5%
Best available rate for savings = ~ 3%

NZ inflation = ~ 5%
RBNZ official interest rate = 2.5%
Best available rate for savings = ~ 4.5%

The Pound will remain weak/Kiwi will remain strong so long as the "*return*" on investment remains so much worse in the UK (I won't say "better in NZ", since it is still a negative real return, just a less bad one).

There was an interesting statistic in the papers here last week saying that if you had invested £1,000 at the start of 2008, and received an average rate of interest, your £1,000 would now have a buying power of just £935. In real terms you'd have lost around 7% of your capital. Even that does not take into account the 25% currency depreciation on top.

I think UK and US interest rates will remain close to zero for very many years. This is the least bad option available for righting their sinking ship economies. By doing this for 5-10 years you can effectively transfer an awful lot of money from prudent savers to reckless debtors without anyone really noticing.

Justcol

I wouldn't bank on it, The $$ shouldn't be anywhere near its current value yet it still is.
If it falls back it will only be a couple of cents at best unless the big guy upstairs suddenly
decides to answer the prayers of a million expats.

Genesis

And look...it is coming down to 75 cents US!! The pound was almost at 2.09 as of close of trading today. No thanks to anything other than the kiwi losing traction for manifold reasons. They say as it has been mooted afore....the kiwi goes up in value by the stairs and falls via the express elevator! Alas things are getting shittier and shittier by the day in good old blighty. Kate and I are both very, very glad to have cashed in our UK public service pensions. I honestly doubt the ability of the govt in years to come to be able to pay out what they were supposed to..you cannot pay what you don't have eh?

whitesand

Have now lost all interest in the exchange rate as I won't be bringing any money over. However, I think this place will go down the pan long before the UK does. The US dollar wlll recover and so will the UK economy. Interests rates may remain low in the UK, but the cost of living here far outweighs any benefits of being here long term as this won't change.

Genesis

Is that because you think you will return? Reading your post I guess you will. We still find a better standard of living here than we could in the UK. Kate's job in palliative care would be impossible to replicate in the UK, even if it was I would still find those extra 60 million people too hard too handle. I fear they feel the same way about me, all of them! So for now I am stuck with NZ just like NZ is lumbered with me!!

sheene

....and to make matters worse, many public service workers have seen little or no salary increase for the past 3 years. People who I worked with who have been in NZ for 10 years, and always said they were 'comfortable', are now really feeling the pinch.

whitesand

Genesis, what really frightens me is being older and trapped here with no money. I see so many who are feeling the pinch and being trapped here without having the money to travel or get back. I like Europe and feel I want to be nearer. I also love Oz but fear that has also become so expensive it ain't much fun to live there any more.

Also, NZ simply doesn't have the buzz to hold us here and the weather is not much better than the UK.

Genesis

I know what you mean about being closer to Europe. NZ works for us at the moment as Kate's nursing career is going very well and our 3 young kids are very happy here. If we left NZ I think we would only consider Ireland as it is very sparsely populated. I am personally not that worried about being old with no money in NZ. I think I would rather be old with less money here than being old with less money in the UK. Its horses for courses eh?