What dollar parity means for Aussie and Kiwi economies
For the first time, New Zealand’s dollar is edging toward parity with the Australian dollar. Housing booms in both nations are being credited with causing the phenomenon, which has never before been observed since both currencies were freely-floated in the 1980s.
House price gains in Australia have helped to line Aussie pockets, leading consumers to spend more on imported goods, thereby boosting the country’s current account deficit. Increased levels of immigration to New Zealand — and the resulting injection of foreign capital into the country’s housing market — have tightened its current account gap.
But what might this mean for the countries’ respective economies?
Kiwi exporters get the short end of the stick
Australia is New Zealand’s second-biggest trade partner, while New Zealand is only Australia’s seventh-largest trade partner. This means that when the New Zealand dollar grows stronger, the country’s large volume of food and wine exports become more expensive for Australian consumers.
Kiwi consumers are the lucky ones
On the other hand, Australian imports will be cheaper for Kiwi shoppers. Aussie beef is increasingly appearing in New Zealand’s supermarkets and Aussie grain has long been shipped over the Tasman Sea. In the long term, this will lower the price of many food items in New Zealand.
Aussies themselves skip trips to New Zealand
While Australian goods might be making their way to New Zealand’s shores, dollar parity would make trips to the island nation more expensive for would-be Aussie tourists. The Kiwi tourism sector has historically been dominated by visits from the neighbouring continent, and higher prices could deter the crucial demographic.
Timeline: India takes unicorn leap with six in five days
We chart an historic week in India’s tech industry, where in just five days, between 5-9 April 2021, the country achieved six new unicorns, bringing India’s total to 10 in 2021 to date, an immense unicorn leap from just seven in 2020 and six in 2019.
April 5: Meesho
India’s first social commerce unicorn, Meesho raised US$300m from SoftBank, Facebook and Shunwei Capital, giving the Bangalore-based startup a US$2.1bn valuation, a threefold jump from its previous funding round in 2019. Founded in 2015 by two IIT-Delhi graduates, Meesho connects producers and resellers, helping small businesses sell through social media. It has 45m customers and has enabled 13m entrepreneurs to start their online businesses with no investment.
April 6: CRED
Founded just over two years ago, Bangalore-based credit card repayment app CRED raised US$215m from Falcon Edge Capital and Coatue, nearly trebling its valuation to US$2.2bn from its January US$80m round. Allowing customers to pay off their credit card debt while earning CRED coins which they cash in for rewards, CRED has grown rapidly during COVID-19, doubling its customer base to nearly 6 million in a year.
April 7: API Holdings / Groww
The first epharmacy startup to gain unicorn status, PharmEasy (API Holdings), which has digitised 60,000 brick and mortar pharmacies and 400 doctors across India, raised US$350m in a round led by Prosus Ventures. Founded by four former Flipkart employees as a way of making investing simple, investment platform Groww became India’s second-youngest fintech unicorn, raising US$83m in Series D funding led by Tiger Global, quadrupling its previous round in September.
April 8: ShareChat
New Delhi-grown social media startup ShareChat, founded in 2016 by Mohalla Tech raised US$502m from Lightspeed Ventures, Tiger Global, Twitter and Snap taking its raised total over six rounds to US$766m and pushing its valuation to US$2.1bn. The funding will be used to grow its user base and short video platform Moj, which launched in 2020 following TikTok’s ban in India. The regional language startup claims 280m users.
April 9: Gupshup
AI-led conversational message startup joined the unicorn club after raising US$100m from Tiger Global giving it a ten-fold valuation of US$1.4bn. The smart messaging platform, which has seen accelerated growth during the pandemic, was founded in Bangalore in 2005 by serial entrepreneur Beerud Sheth, whose online freelancing platform Elance is now listed. Gupshup’s API enables 100,000+ businesses to build messaging and conversation experiences across 30+ communication channels.