The New Zealand dollar (; sign: $; code: NZD) is the official currency and legal tender of New Zealand including 2 freely associated states of New Zealand (Cook Islands and Niue), 2 dependent territories of New Zealand (Ross Dependency and Tokelau) and a British territory, the Pitcairn Islands. Within New Zealand, it is almost always abbreviated with the dollar sign ($). The abbreviations "$NZ" since the flightless bird, the kiwi, is depicted on its one-dollar coin. It is the tenth most traded currency in the world, representing 2.1% of global foreign exchange market daily turnover in 2019.
History
Introduction
Prior to the introduction of the New Zealand dollar in 1967, the New Zealand pound was the currency of New Zealand, which had been distinct from the pound sterling since 1933. The pound used the £sd system, in which the pound was divided into 20 shillings and one shilling was divided into 12 pence, a system which by the 1950s was considered complicated and cumbersome.
Switching to decimal currency had been proposed in New Zealand since the 1930s, although only in the 1950s did any plans come to fruition. In 1957, a committee was set up by the Government to investigate decimal currency. The idea fell on fertile ground, and in 1963, the Government decided to decimalise New Zealand currency. The Decimal Currency Act was passed in 1964, setting the date of transition to 10 July 1967. Words such as "fern", "kiwi" and "zeal" were proposed to avoid confusion with the word "dollar", which many people associate with the United States dollar. In the end, the word "dollar" was chosen anyway, and an anthropomorphic dollar note cartoon character called "Mr. Dollar" became the symbol of transition in a huge publicity campaign.
On Monday 10 July 1967 ("Decimal Currency Day"), the New Zealand dollar was introduced to replace the pound at a rate of two dollars to one pound (one dollar to ten shillings, ten cents to one shilling, cent to a penny). Some 27 million new banknotes were printed and 165 million new coins were minted for the changeover.
In 1971, the US devalued its dollar relative to gold, leading New Zealand on 23 December 1971 to peg its dollar at US$1.1952, keeping the same gold value. From 9 July 1973 to 4 March 1985 the dollar's value was determined from a trade-weighted basket of currencies.
On 4 March 1985, the NZ$ was floated at the initial rate of US$0.4444. Since then, the dollar's value has been determined by the financial markets, and has been in the range of about US$0.39 to 0.88.
The dollar's post-float low was US$0.3922 on 22 November 2000, and it reached a post-float high on 9 July 2014 of US$0.8821. Much of this medium-term variation in the exchange rate has been attributed to differences in interest rates.
The New Zealand dollar is among the 10 most-traded currencies. However, it rebounded strongly as the year progressed, reaching the US$0.75 range by November 2009. Unions also called on the Government and the Reserve Bank to take action, but as of February 2013 both had declined.
As of early June 2017, the NZD was trading at approximately US$0.71, and in early November 2019 it was valued as US$0.63 = NZ$1.
Coins
History
thumb|right|Proposed designs for a $1 (10 shilling) coin
On the introduction of the dollar, coins came in denominations of 1c, 2c, 5c, 10c, 20c, and 50c. The 1c and 2c coins were bronze, the others were cupro-nickel. To ease transition, the 5c, 10c, and 20c were the same size as the sixpence, shilling and florin that they respectively replaced, and until 1970, the ten-cent coin bore the additional legend "One Shilling". The obverse designs of all the coins featured Arnold Machin's portrait of Queen Elizabeth II, with the legend ELIZABETH II NEW ZEALAND [date]. The reverse sides of coins introduced in 1967 did not follow the designs that were originally intended for them. Those modern art and sculpture themed designs were leaked to a newspaper and met a very negative public reaction. The final releases were given more conservative designs in line with public expectations.
In 1986, New Zealand adopted Raphael Maklouf's new portrait of the Queen. The 1c and 2c coins were last minted for circulation in 1987, with collector coins being made for 1988. The coins were demonetised on 30 April 1990. and of Armistice Day.
Current circulating coins
thumb|centre|500px|The reverse designs of the current circulating New Zealand dollar coins. Image by Reserve Bank of New Zealand.
{|class="wikitable" style="font-size: 90%; margin: 1em auto 1em auto;"
|-
! colspan="2" |Image
! rowspan="2" | Value !! colspan=4| Technical Parameters !! colspan=3| Description !! rowspan=2| Date of Issue
|-
!Obverse
!Reverse
! Diameter !! Thickness !! Mass !! Composition !! Edge !! Reverse !! Obverse
|-
| align="center" style="background:white"|51px|0.10 NZD coin Reverse
| align="center" style="background:white"|51px|0.10 NZD coin Obverse
| 10c
| 20.50 mm
| 1.58 mm
| 3.30 g
| Copper-plated steel
| Plain
| Queen Elizabeth II
| A Māori koruru, or carved head
| 31 July 2006
|-
| align="center" style="background:white"|54px|0.20 NZD coin Reverse
| align="center" style="background:white"|54px|0.20 NZD coin Obverse
| 20c
| 21.75 mm
| 1.56 mm
| 4.00 g
| rowspan=2| Nickel-plated steel
| "Spanish flower"
| rowspan=2| Queen Elizabeth II
| Māori carving of Pukaki, a chief of the Ngati Whakaue iwi between traditional koru kowhaiwhai patterns
| rowspan=2| 31 July 2006
|-
| align="center" style="background:white"|62px|0.50 NZD coin Reverse
| align="center" style="background:white"|62px|0.50 NZD coin Obverse
| 50c
| 24.75 mm
| 1.70 mm
| 5.00 g
| Plain
| HM Bark Endeavour and Mount Taranaki
|-
| align="center" style="background:white"|58px|1 NZD coin Reverse
| align="center" style="background:white"|58px|1 NZD coin Obverse
| $1
| 23.00 mm
| 2.74 mm
| 8 g
| rowspan=2| Aluminium bronze
| Intermittent milling
| rowspan=2| Queen Elizabeth II
| Kiwi and silver fern
| rowspan=2| 11 February 1991
|-
|
|
| $2
| 26.50 mm
| 2.70 mm
| 10 g
| Grooved
| Kotuku (great egret)
|-
| colspan=12|
|}
Future
After the death of Queen Elizabeth II in September 2022, the Reserve Bank said it would exhaust its existing coin stocks before introducing new coins featuring King Charles III. Based on current stock levels, this would likely be several years away.
Banknotes
History
In 1967, notes were introduced in denominations of $1, $2, $5, $10, $20 and $100, with all except the $5 replacing their pound predecessors. The original series of dollar notes featured on the obverse a portrait of Queen Elizabeth II wearing Queen Alexandra's Kokoshnik tiara, King George's VI festoon necklace, and Queen Mary's floret earrings, while the reverse featured native birds and plants. The notes were changed slightly in 1981 due to a change of printer (from De La Rue to Bradbury, Wilkinson & Co.)—the most noticeable difference being the portrait based upon a photograph by Peter Grugeon, in which Queen Elizabeth II is wearing Grand Duchess Vladimir's tiara and Queen Victoria's golden jubilee necklace. refreshing the note design and improving security features. As of 2021, Series 6 and 7 notes are currently legal tender.
In September 2022, following the death of Queen Elizabeth II, the Reserve Bank said it would exhaust its existing stocks of $20 notes before introducing new notes featuring King Charles III.
Current exchange rates
In currency trading
The New Zealand dollar contributes greatly to the total global exchange market—far in excess of New Zealand's relative share of population or global GDP.
According to the Bank for International Settlements, the New Zealand dollar's share of global foreign exchange market daily turnover in 2016 was 2.1% (up from 1.6% in 2010) giving it a rank of 11th. Trading in the currency has climbed steadily since the same survey in 1998 when the NZD's ranking was 17th and the share of turnover was just 0.2%.
See also
- Australian dollar
- Cook Islands dollar
- Economy of New Zealand
- History of Chatham Islands numismatics
- Pitcairn Islands dollar
- Postal orders of New Zealand
Notes
References
External links
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- International economics – History of the regulation surrounding the NZ$ exchange rate ==> Server not found
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- ANZ New Zealand – View the current exchange rate graphs of NZ$/inr
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- Change for the Better – Information about changes to coins from 31 July 2006. ==> Server not found
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- Reserve bank of New Zealand – Money issuing Authority
- Historical New Zealand Trading bank notes – Old extremely rare banknotes of New Zealand
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- New Zealand banknote history ==> this page don't works (2017/03/15)
- Legal and economic framework ==> URL not found
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- Images of historic and modern New Zealand bank notes
- Current and historical banknotes of New Zealand