New Zealand confident they can deal with US debt crisis

tony nguyen

When the US congress agreed a plan this past weekend to ensure that the country would not default on its existing debt, many observers would have felt that the crisis was over.

However, several reports in the days since a deal was reached have suggested that investor confidence in the US generally has been hit hard and there is a feeling that the crisis is over but the consequences will continue to be felt around the globe.

The US dollar is such an important part of the global economic structure that when its value is threatened, the effects can be far reaching.

One country with significant interest in the US debt crisis which has taken steps to safeguard themselves is New Zealand.

The New Zealand Finance Minister, Bill English, has suggested that the nation is “better placed than many other countries” to deal with any further fallout from the crisis.

“Despite a compromise deal being reached in Washington, there is no doubt the situation in the United States is serious – both for the US itself and the global economy.

Our financial system and our economy are both in better shape than a few years ago to manage global market uncertainties. This reflects improvements in market regulations and an economy that is growing.”

It is certainly a bullish statement from a country which has recently carried out a major reform of its tax system. The new system is designed to discourage borrowing and consumption, tightening tax rules on property speculation generally.

The New Zealand public can only hope that the confidence which the government have is well founded and that the economy continues to function well in the face of the US debt crisis.

Transferring money to New Zealand

Are looking to invest in New Zealand? If so, it is recommended that you think carefully about how you will be transferring money to New Zealand. Foreign currency exchange rates quoted by banks are usually not as good as the exchange rates available through specialist currency dealers.

So if you are sending money to New Zealand – which you will inevitably have to do if you are looking to make a property investment - be sure to compare the market before you buy your overseas currency.

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