Kiwi heads for 0.9% weekly gain on TWI after Greek vote
The New Zealand dollar is poised for a 0.9% gain on a weekly basis after Greece elected a government that will embrace tough austerity measures in exchange for a regional bailout package.
USINESSDESK: The New Zealand dollar is poised for a 0.9% gain on a weekly basis after Greece elected a government that will embrace tough austerity measures in exchange for a regional bailout package.
The kiwi rose to 71.58 on the trade-weighted index from 70.93 last week, and was down from 71.92 yesterday.
It was little changed at 78.69 US cents at 5pm from 78.65 cents at 8am and down from 79.69 cents yesterday.
The currency was bolstered by increased investor optimism Europe will address its ballooning indebtedness and better than expected first-quarter New Zealand growth.
Some of that sentiment was eroded after the Federal Reserve didn't embark on a third round of quantitative easing, and after Moody's Investors Service downgraded 17 banks with significant exposure and risk of losses from capital markets.
"The trajectory of global growth should decide the path of the kiwi, overlaid with any Euro shocks," said Imre Speizer, market strategist at Westpac Banking.
The kiwi's rally over the past month has probably ended, and it will fall to "74 US cents over the next two months", he said.
The kiwi dollar climbed 4.9% over the past month against the greenback and 4.7% on a trade-weighted basis.
Four of five strategists surveyed by BusinessDesk on Monday expected the kiwi to gain this week.
Mr Speizer said markets will be watching policy makers and central banks for their leads, with the the leaders of Italy, Germany, Spain and France set to discuss the region's issues ahead of a summit next week.
The New Zealand dollar fell to 62.76 euro cents from 62.87 cents yesterday and declined to 50.47 pence from 50.82 pence.
It rose to 78.33 Australian cents from 78.24 cents yesterday, and decreased to 63.32 yen from 63.42 yen.
Paul McBeth
Fri, 22 Jun 2012
Fri, 22 Jun 2012
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Kiwi heads for 0.9% weekly gain on TWI after Greek vote
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