On Monday, it was revealed that Prime Minister Liz Truss was abandoning plans to scrap the 45p top rate of income tax amid widespread criticism of the proposed measure news then emerged that Chancellor Kwasi Kwarteng would bring forward the announcement of his medium-term fiscal plans. Encouraging remarks from UK politicians and the prospect of a degree of financial stability cheered GBP investors, although Sterling weakened somewhat towards the close of the week.Ī risk on mood supported the Pound at the beginning of the weekly session, as amendments to the UK’s mini-budget and a welcome intervention from the Bank of England (BoE) helped restore some faith in the UK economy. The Pound managed to climb against the majority of its peers last week despite a lack of significant data. Pound (GBP) Exchange Rates Driven by External Factors Amid Lack of Data Market sentiment shifted during Thursday’s Asian session and headwinds against NZD were compounded by poor data from Australia: the country’s trade surplus narrowed in August, weakening AUD and subsequently weighing upon NZD. According to RBNZ Senior Advisor James Weir: ‘Committee members agreed that monetary conditions needed to continue to tighten until they are confident there is sufficient restraint on spending to bring inflation back within its 1 to 3% per annum target range.’įollowing the central bank’s bold move midweek, the ‘Kiwi’ succumbed to pressure from widespread risk aversion. ‘Kiwi’ investors were encouraged by hints at further interest rate hikes ahead, which helped to lift the performance of the New Zealand Dollar. Wednesday’s hawkish action from the Reserve Bank of New Zealand lifted the country’s interest rate to a seven-year high of 3.5%, in line with market expectations. The Australian Dollar (AUD), with which the New Zealand Dollar has a close trading relationship, came under pressure as the Reserve Bank of Australia (RBA) hiked interest rates by less than expected. Where relevant economic data is scarce, the New Zealand Dollar invariably takes influence from risk sentiment, commodity dynamics and the performance of the Australian Dollar.ĭairy prices remained steady on Monday and into Tuesday a moderate risk-on mood lent support to the ‘Kiwi’. Wednesday’s central bank action was the most significant trading stimulus for the ‘Kiwi’ throughout the week subsequently, risk aversion drew support away from the Antipodean currency.Īt the beginning of the week, a lack of significant New Zealand data left NZD exchange rates to trade unevenly. The New Zealand Dollar (NZD) rose against the majority of its peers midweek, buoyed by the RBNZ’s 50bps interest rate hike. New Zealand Dollar (NZD) Exchange Rates Bolstered by Interest Rate Hike Meanwhile, the Pound (GBP) came under pressure from a lack of significant data and mixed messaging over the announcement of the UK’s new fiscal policy.Īt the time of writing, GBP/NZD is trading at NZ$1.9808, up 0.5% from today’s opening levels. dollars by the bank processing the payment, not the date the foreign currency payment is received by the IRS.The Pound New Zealand Dollar (GBP/NZD) exchange rate traded broadly lower last week, subdued by the Reserve Bank of New Zealand (RBNZ)’s decision to hike interest rates by 50bps. dollars is based on the date the foreign currency is converted to U.S. tax payments in a foreign currency, the exchange rate used by the IRS to convert the foreign currency into U.S.
Note: The exchange rates referenced on this page do not apply when making payments of U.S. Below are government and external resources that provide currency exchange rates. Currency Exchange RatesĪn exchange rate is the rate at which one currency may be converted into another, also called rate of exchange of foreign exchange rate or currency exchange rate. dollars to report on your income tax return. At the end of the year, translate the results, such as income or loss, into U.S. dollar, make all income tax determinations in your functional currency. If your functional currency is not the U.S. You can generally get exchange rates from banks and U.S. If there is more than one exchange rate, use the one that most properly reflects your income. Use the exchange rate prevailing when you receive, pay, or accrue the item. (including taxes), that you receive, pay, or accrue in a foreign currency and that will affect computation of your income tax. dollar, you must immediately translate into dollars all items of income, expense, etc. Make all income tax determinations in your functional currency. The business books and records are not kept in the currency of the economic environment in which a significant part of the business activities is conducted.
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