The Pound banknotes were produced by the six different trading banks until 1924, when a single uniform design was implemented. In fact, during the 1800s, New Zealand used its coins and banknotes before British currency was even legal currency. However, nothing was made official until 1933, when New Zealand issued their first official coins, based on the British pound, shilling, and pence. Queen Elizabeth II has appeared on New Zealand currency for several decades, and new coins and banknotes will feature King Charles III. The best way to exchange currency, for those staying in New Zealand on an extended trip or working holiday, is to transfer money from your home bank account to your New Zealand bank account. Find out how to transfer money at How to Transfer Money to Your New Zealand Bank Account.
He is an expert in New Zealand travel and has tested over 600 activities and 300+ accommodations across the country. The unit of currency in New Zealand is the New Zealand Dollar, often seen written as “NZD” or “NZ$”. This guide to New Zealand currency will go through how money is commonly using in New Zealand, from currency values to banking in New Zealand to the Goods and Services Tax. Higher interest rates in New Zealand also attract foreign capital, as investors seek to capitalize on better returns.
What is the currency in New Zealand called?
Introduced in 1967, the NZD replaced the New Zealand pound, aligning the nation’s currency with the decimal system. Initially pegged to the US dollar, it transitioned derivatives essentials to a floating exchange rate regime in 1985, allowing market forces to determine its value. Over the years, the NZD has experienced fluctuations influenced by various factors, including economic performance, global commodity prices, and monetary policy decisions by the Reserve Bank of New Zealand. You’re unlikely to be able to officially transact in AUD in New Zealand , which is why it’s time to start getting used to NZD and learning more about the currency exchange rates so you’ll know what you’re spending on your trip. Going to a money exchange office can be a quick way to get your hands on foreign currency cash. Exchange rates and fees do vary widely, so you’ll need to shop around.
Wise accounts can hold 40+ currencies, so you can top up in Australia easily from your bank or using your card. Traders and investors have favored the New Zealand dollar as a carry trade currency because the country has had higher interest rates compared to other developed nations. NZD is one of the most traded currencies in the world, making it a liquid currency in forex markets. Decimalization of the NZD (division into 100 cents) took place in 1967 when the New Zealand dollar replaced the New Zealand pound at a rate of two dollars to one pound. Initially pegged to the United States dollar, NZD went through a series of changes in the fixed exchange rate until March of 1985, when the currency was allowed to float freely.
The carry trade is one of the most popular trading strategies in the currency market. Executing a carry trade involves nothing more than buying a high-yielding currency and funding it with a low-yielding currency. The strength of a currency tends to fluctuate so the strength of the NZD may not always be so strong. However, overall, NZD is considered a stable currency due to the strength of the quebex New Zealand economy and its outlook. Tourism is a strong economic driving force for New Zealand, so when tourism is doing well in the country, the currency will tend to be stronger. Other economic factors, such as growth rate, GDP, unemployment, and inflation are strong and, therefore, lead to a strong currency.
Current circulating banknotes
We’ve used Auckland as our example but you may find the prices in your destination are different depending on location. New Zealand Dollars notes are frequently used in $5, $10, $20, $50 and $100 denominations. While New Zealand is a popular destination for Australians, you cannot use Australian dollars in New Zealand. The rest of this article has some information about how 1 year sober gift ideas you can convert currency for your holiday.
- According to news reports, members of the public recommended calling it the “fern,” “kiwi,” “crown,” or “zeal,” among dozens of other suggestions.
- Cash is often easier for tipping and making smaller purchases, plus you’ve got a nice backup if your card is ever out of action for some reason.
- Most major credit cards can be used in New Zealand that are Visa or MasterCard, but we recommend carrying a little bit of cash on you just in case.
Let’s walk through the cash notes and coins you’ll find in circulation in New Zealand so you’re prepared. If you have run out of time before your trip, you might find you get a better rate and lower overall costs if you make an ATM withdrawal on arrival in New Zealand instead. When the prices of commodities such as dairy or meat rise, the New Zealand economy benefits, which typically leads to an appreciation in the value of the NZD. This connection to global commodity prices is one of the reasons why the NZD tends to be volatile, often moving in tandem with global economic trends and commodity cycles. Cards are widely accepted in New Zealand but it’s still worth having some cash with you at all times. Some merchants will prefer cash, but having a card for higher value payments and in busier more tourist places is also convenient.
How much does a trip to New Zealand cost?
The country’s top industries include agriculture, dairy, forestry, fishing, mining, and tourism. New Zealand is one of the world’s largest exporters of whole milk powder so the NZD would most likely benefit if milk prices rise. The kiwi also circulates in Tokelau, Pitcairn Islands, Niue, and the Cook Islands in addition to being the official currency of New Zealand. When the Fed intervenes in open market activities to make the U.S. dollar stronger, for example, the value of the NZD/USD cross could decline, due to a strengthening of the U.S. dollar when compared to the New Zealand dollar. Since 1999, the New Zealand government has produced polymer or plastic versions of the New Zealand dollar, which has made the note more secure against counterfeiting.
For this reason, we have put together the following articles to give you an idea of the cost of living in New Zealand. For information on opening a New Zealand bank account, see How to Open a New Zealand Bank Account. The NZD is comparatively a strong currency, worth approximately US$0.62 as of November 2023. The Cook Islands and Niue are independent countries that govern and are situated on islands. Tokelau is a New Zealand-administered overseas territory, Pitcairn Islands is a British Overseas Territory, and Ross Dependency is a New Zealand-claimed territory in Antarctica.
The NZD currency has a long history of colorful and vibrant money and, since its first issuing, has changed its printed design several times. In 1967, notes were introduced in denominations of $1, $2, $5, $10, $20 and $100, with all except the $5 replacing their pound predecessors. $1 and $2 notes were discontinued in 1991 after being replaced with coins.
Are New Zealand Dollars One of the Best Currencies To Trade?
You’ll find currency exchange offices in all major New Zealand towns and cities, both in central districts and in areas where there are lots of tourists. Check out Wise as a travel card you can use to hold and exchange NZD with low fees and the mid-market rate – or try Revolut as a convenient card you can top up in AUD and use in New Zealand easily. Because exchange rates change so frequently, and every provider offers different rates it’s hard to say the cheapest way and place to exchange currency. Despite its many advantages, the New Zealand Dollar is not without its challenges. One of the most notable factors influencing the value of the NZD is its volatility. The NZD is considered a high-risk currency due to its close correlation with global commodity prices, which can fluctuate dramatically.
New Zealand has a modern banking sector, and many vendors accept credit cards and digital payments. Still, it’s a good idea to have some cash if you’ll be visiting rural areas and for rare occasions when you need to leave a tip. New Zealand banks are open weekdays 9.30am-4.30pm and sometimes on a weekend. Most will work with an international credit or debit card as long as your card has a four-digit pin code.
New Zealand’s currency is also the legal tender in the Pitcairn Island and the Cook Islands, and in Tokelau, Niue, and the Ross Dependency, a region in Antarctica claimed by New Zealand. When you’re buying currency for New Zealand, look out for the currency code NZD. And once you’re in New Zealand, you’ll see the symbol $ used to show prices. The currency usually has a bird on one side of a banknote or coin as well as an important historical figure of New Zealand. NZD/USD is affected by factors that influence the value of the New Zealand dollar and/or the U.S. dollar in relation to each other and other currencies. For this reason, the interest rate differential between the Reserve Bank of New Zealand (RBNZ) and the Federal Reserve (Fed) will affect the value of these currencies when compared to each other.
- Other factors affecting the NZD are dairy prices and tourism numbers.
- This article has been reviewed and approved by Robin, who is the co-founder of NZ Pocket Guide.
- The currency usually has a bird on one side of a banknote or coin as well as an important historical figure of New Zealand.
- In 1986, New Zealand adopted Raphael Maklouf’s new portrait of the Queen.
It took three years to launch the new currency—with nearly 200 million new coins and banknotes—which arrived on “Decimal Currency Day” in 1967. Whether you change money in advance, on arrival, or simply use your card to pay when you’re in New Zealand, you’ll soon become familiar with the notes and coins you’re handling. The NZD meets all of these criteria, making it one of the most widely traded currencies in the foreign exchange market. You’ll always get the lowest available fee and there are no extra foreign transaction charges.
The original New Zealand dollar banknotes all featured portraits of Queen Elizabeth. Use our currency converter to see how much your money is worth in New Zealand dollar and familiarise yourself with the mid-market rate before your trip. Australia ranks as New Zealand’s second-largest trading partner behind China.
Interestingly, the polymer note can go through a washing machine without suffering any material damage. In 2016, the currency had its most recent update, with even more bright colors and updated security features. Today, the NZD is one of the ten most traded currencies in the world and is particularly popular with currency traders due to its high liquidity and relatively low interest rates. Australian currency and New Zealand currency are entirely separate currencies, and you can’t use one currency in the other country.
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