IDEAS home Printed from
   My bibliography  Save this article

An update on Eurokiwi and Uridashi bonds


  • David Drage
  • Anella Munro
  • Cath Sleeman

    (Reserve Bank of New Zealand)


This article provides an update on the market for offshore issues of New Zealand dollar denominated bonds, commonly referred to as New Zealand dollar Eurobonds, Eurokiwis, New Zealand dollar Uridashi, and global issues. Net issuance of these bonds has surged in the past two years, driven by strong demand for credit in New Zealand (high domestic interest rates) and by supply conditions internationally (low yields in Europe and Japan). Offshore issuance of New Zealand dollar bonds provides an important channel for New Zealand firms and households to access foreign capital and reduces, at the margin, our cost of capital. These bonds provide a useful source of hedging for New Zealand's foreign currency external debt, reducing the potential for undesirable valuation effects during times of stress. Ex-post returns on Eurokiwi bonds that had matured by the end of 2004 were on average the same, in euros, as German government bonds, but more variable, reflecting exchange rate risk. In theory, the increased supply of foreign capital from offshore New Zealand dollar bonds puts upward pressure on the New Zealand dollar at issue and downward pressure at maturity. However, historical data suggests that any exchange rate impact around the time of maturity tends to be small, consistent with the idea expected effects are priced-in well in advance by forward-looking markets.

Suggested Citation

  • David Drage & Anella Munro & Cath Sleeman, 2005. "An update on Eurokiwi and Uridashi bonds," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 68, September.
  • Handle: RePEc:nzb:nzbbul:september2005:4

    Download full text from publisher

    File URL:
    Download Restriction: no


    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

    Cited by:

    1. Anella Munro & Philip Wooldridge, 2011. "Motivations for swap-covered foreign currency borrowing," BIS Papers chapters,in: Bank for International Settlements (ed.), Currency internationalisation: lessons from the global financial crisis and prospects for the future in Asia and the Pacific, volume 61, pages 19-56 Bank for International Settlements.
    2. YV Reddy, 2012. "Summary of the discussion," BIS Papers chapters,in: Bank for International Settlements (ed.), Financial sector regulation for growth, equity and stability, volume 62, pages 39-40 Bank for International Settlements.
    3. Enzo Cassino & Zoe Wallis, 2010. "The New Zealand dollar through the global financial crisis," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 73, pages 20-30, September.
    4. Willy Chetwin & Tim Ng & Daan Steenkamp, 2013. "New Zealand’s short- and medium-term real exchange rate volatility: drivers and policy implications," Reserve Bank of New Zealand Analytical Notes series AN2013/03, Reserve Bank of New Zealand.
    5. Lauren Rosborough & Raiko Shareef, 2013. "Foreign exchange turnover: trends in New Zealand and abroad," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 76, pages 31-40, December.
    6. Susan Black & Anella Munro, 2010. "Why issue bonds offshore?," BIS Papers chapters,in: Bank for International Settlements (ed.), The international financial crisis and policy challenges in Asia and the Pacific, volume 52, pages 97-144 Bank for International Settlements.
    7. Paul Bedford, 2008. "The global financial crisis and its transmission to New Zealand – an external balance sheet analysis," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 71, December.
    8. Robert McCauley, 2006. "Internationalising a currency: the case of the Australian dollar," BIS Quarterly Review, Bank for International Settlements, December.
    9. Geordie Reid, 2014. "Can’t see the wood for the trees – shedding light on Kauri bonds," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 77, pages 26-33, June.
    10. Sebastian Edwards, 2006. "External Imbalances in an Advanced, Commodity-Exporting Country: The Case of New Zealand," NBER Working Papers 12620, National Bureau of Economic Research, Inc.
    11. Bruce White, 2013. "Macroeconomic Policy in New Zealand: From the Great Inflation to the Global Financial Crisis," Treasury Working Paper Series 13/30, New Zealand Treasury.
    12. Willy Chetwin, 2012. "Business cycle review, 1998-2011," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 75, pages 14-27, March.
    13. David Hargreaves & Elizabeth Watson, 2011. "Sudden stops, external debt and the exchange rate," Reserve Bank of New Zealand Bulletin, Reserve Bank of New Zealand, vol. 74, pages 1-11, December.

    More about this item


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:nzb:nzbbul:september2005:4. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Reserve Bank of New Zealand Knowledge Centre). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.