Cross-border remittances between the United States and New Zealand are rather common. In 2016, around U.S. $44 million was sent from New Zealand to the United States, and around U.S. $16 million flowed in the opposite direction. These numbers only take into account remittances carried out for personal reasons.
The NZD/USD currency pair is one of the majors, and it is nicknamed the Kiwi in the forex market. The average daily volume of this currency pair stands at around U.S. $229 billion, and it accounted for close to 6% of the total market share in January 2018.
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The U.S. Dollar
The U.S. dollar is the world’s most commonly traded currency. It is also the world’s most preferred reserve currency. The use of the U.S. dollar as a currency standard in the commodity market ensures that its value has a direct impact on prices of different commodities. The global forex market turnover share of the U.S. dollar exceeded 87% in April 2016. Around U.S. $5.1 trillion makes its way through the forex market each day.
Officially adopted by the United States in 1792, the U.S. dollar is also used as legal tender in other places. These include the Caribbean, the Federated States of Micronesia, Turks and Caicos Islands, two British Overseas Territories, El Salvador, and Ecuador. Several currencies still remain pegged to the U.S. dollar, some of which include the Bahamian dollar, the Belizean dollar, the Djiboutian franc, the Hong Kong dollar, the Omani riyal, and the Venezuelan bolivar.
|Nicknames||Buck, moolah, paper, dough, dead presidents, |
bones, greenback, green
|Bank notes||$1, $2, $5, $10, $20, $50, $100|
|Coins||1c, 5c, 10c, 25c, 50c, $1|
The New Zealand Dollar
In April 2016, the New Zealand dollar was the 10th most commonly traded currency in the world, accounting for 2.1% of the global forex market turnover. The average trading volume of the New Zealand dollar stood at NZ $198.11 billion in April 2018.
The New Zealand dollar has been the official currency of New Zealand since 1967, when it replaced the New Zealand pound that was in use since 1840. It is also used as legal tender in the Cook Islands, the Pitcairn Islands, Niue, and Tokelau. Banknotes of the New Zealand dollar have had a history of being vibrant and colorful, and their designs have changed several times.
|Currency symbol||$, NZ$|
|Bank notes||$5, $10, $20, $50, $100|
|Coins||10c, 20c, 50c, $1, $2|
U.S. Dollar / New Zealand Dollar Historical Rates
When it was first introduced, the New Zealand dollar was pegged to the U.S. dollar at the rate of NZ $1 to U.S. $1.62. The peg changed several times, until the New Zealand dollar became a free floating currency in 1985. The New Zealand dollar is traded most actively against the U.S. dollar. However, the USD/NZD pair in known to experience volatility because of the New Zealand dollar’s sensitivity to the American economy.
Historically, the New Zealand dollar has benefited by a weakening U.S. economy. On the other hand, the best opportunities for the U.S. dollar have come about because of instability in New Zealand’s predominately dairy-based export industry.
The NZD/USD currency pair tends to have a positive correlation with the AUD/USD pair.
USD/NZD in the last five years
|U.S. $1 =|
|1 July, 2013||NZ $1.2778|
|1 July, 2014||NZ $1.1763|
|1 July, 2015||NZ $1.5169|
|1 July, 2016||NZ $1.3874|
|1 July, 2017||NZ $1.3307|
USD/NZD in the last five months
|U.S. $1 =|
|1 March, 2018||NZ $1.3820|
|1 April, 2018||NZ $1.4213|
|1 May, 2018||NZ $1.4287|
|1 June, 2018||NZ $1.4870|
|1 July, 2018||NZ $1.4608|
What Affects USD/NZD Rates?
Factors that affect the value of the U.S. dollar and the New Zealand dollar have a bearing on which way the USD/NZD currency pair swings. For instance, the interest rate differential between the Reserve Bank of New Zealand and the U.S. Federal Reserve affects the value of both currencies against each other.
The value of the New Zealand dollar, a commodity currency, is affected by the dairy industry which accounts for around 30% of the country’s exports. New Zealand is the world’s largest exporter of whole milk powder. As a result, when milk prices are up, so is New Zealand’s economy, and this has a positive effect on its currency too. The country’s economy also depends on tourism, which, in turn, has an effect on the value of its currency.
Some of the other factors that affect the value of the USD/NZD currency pair include inflation rates, monetary policies, foreign trade, as well as the sociopolitical atmosphere of both countries.
Transferring money between the U.S. and New Zealand is fairly easy and you get a number of overseas money transfer companies from which to choose. However, since exchange rates on offer tend to vary, comparing your options might work well for you.