The currency of New Zealand is the New Zealand dollar. It is
also used in Niue, the Cook Islands, the Pitcairn Islands,
and Tokelau. The New Zealand dollar is divided into a
hundred cents. To set it apart from other dollar-named
currencies, the New Zealand dollar is written as
NZ$. Informally, it is called the Kiwi dollar since
“kiwi” is a word which is closely associated with
“Kiwi” is a common name used for 5 flightless species
of birds in New Zealand.
A NZ$1 coin has a kiwi on it. The New Zealand dollar is
among the 12 most traded world currencies.
In 1967 , on July 10, the New Zealand pound was replaced by
the New Zealand dollar when the New Zealand currency was
decimalized at a rate of £1 = NZ$2. Initially, the NZ$ was
pegged to the US dollar at NZ$1 = US$1.39.
On November 21 of the same year, the rate changed to NZ$1 =
US$1.12. This was after the British pound devaluated
although the UK devalued less than New Zealand.
The New Zealand dollar floated on March 4, 1985 at the
beginning rate of US$0.4444. Since this time the New Zealand
dollar's rate has been defined by the financial markets, and
is within the range of approximately US$0.39-0.82.
The value of the New Zealand dollar is often strongly
influenced by trading in currency and is one of the top
most-traded currencies in the world.
In a sense, the New Zealand dollar is not a “true dollar”.
This is because the New Zealand dollar descends directly
from a former Spanish gold coin, “pieces of eight”. Such is
not the situation with the Canadian dollar, the United
States dollar, and the East Caribbean Dollar.
Essentially, the New Zealand dollar is the equivalent of a
half pound sterling. Following the footsteps of Australia
and South Africa, New Zealand when it mad use of the decimal
system, it opted to adopt the half pound unit of account
instead of that of the pound unit.
New Zealand’s choice of
the name “dollar” is because the lower value of the new
currency was closer to the United States dollar that it did
the United Kingdom’s pound sterling.
There are other currencies worldwide that are also
considered not “true dollars”, precisely for the same
reasons mentioned above.
These are the Australian dollar,
the Cayman Islands dollar, the Solomon Islands dollar, the
Jamaican dollar, the Namibian dollar, the Fiji dollar, the
Zimbabwe dollar, and the Rhodesian dollar.
The countries of the world that use dollars which are
directly descended from the authentic Spanish dollar
currency are the Canadian dollar, United States dollar, the
Newfoundland dollar, the Belize dollar, the East Caribbean
dollar, the Guyanese dollar, the Bahamian dollar, the
Bermuda dollar, the Barbados dollar, the Trinidad and Tobago
dollar, the Hong Kong dollar, the Malayan dollar, the
Straits dollar, the Brunei dollar, and the Singapore dollar.
As of 2006, the exchange is 1.5 New Zealand dollar = 1
United States dollar.