Election unlikely to hurt dollar

ANZ Investment Bank head of markets John Body said the last time an election impacted heavily on trade in the New Zealand dollar was as a result of 1993's hung Parliament.

"The market hadn't really experienced that before," he said.

On the Monday following the November 6 election the sharemarket's benchmark index nosedived nearly 10 per cent in early trade and the dollar fell by nearly US2c to US53.85c.

However, both recovered somewhat before the end of the day. They recovered further when foreign investors didn't bail out of New Zealand investments during the offshore sessions as feared.

The following election in 1996, when Winston Peters kept the country waiting for days before saying which party he would enter a coalition with, the markets were barely bothered.

The kiwi traded about a cent lower temporarily while the sharemarket rose on the Monday following polling.