Kiwi makes comeback against the euro

The New Zealand dollar made a comeback today against the euro after falling in early trading.

At 8am, the kiwi fell to €0.5555 against the euro, which was boosted broadly by increased expectations that the European Central Bank would raise interest rates, but managed to climb up to €0.5582 by the end of trading.

The NZ dollar was also buying 76.35USc after reaching a one-week high of around 76.50USc on Saturday morning, and slipping to 76.20USc at 8am today.

The greenback, a traditional safe-haven along with the Swiss franc, failed to capitalise on heightened geopolitical tensions in the Middle East.

Anti-government protesters rallied in Tripoli's streets at the weekend, tribal leaders spoke out against leader Muammar Gaddafi and army units defected to the opposition as oil exporter Libya endured a bloody revolt.

BNZ currency strategist Mike Jones said the NZ dollar against the greenback continued to be torn between the positive impact of strong and rising global commodity prices, and the negative impact of near-term weakness in domestic data.

Meanwhile, a survey of New Zealand's services sector showed a decline in January to a six-month low, with the employment subindex contracting to its lowest level in 17 months.

The kiwi edged up to 75.41Ac from 75.23Ac at 8am today, holding above the seven-week low around 74.85Ac touched on Friday morning.

The NZ dollar was also buying ¥63.44 from ¥63.29 at 8am, while the trade weighted index edged up to 67.79 from 67.59.

NZPA
Mon, 21 Feb 2011

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Kiwi makes comeback against the euro

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