The New Zealand dollar drifted off a new post-float high around US83c against the US dollar reached early today, as the effects of yesterday's monetary policy statement (MPS) from the Reserve Bank of New Zealand (RBNZ) continued to be felt.
The New Zealand dollar drifted off a new post-float high around US83c against the US dollar reached early today, as the effects of yesterday's monetary policy statement (MPS) from the Reserve Bank of New Zealand (RBNZ) continued to be felt.
The NZ dollar was at US82.46c at 5pm, down from its peak around US83c shortly before 4am. It was at US82.47c around 8am from US81.96c at 5pm yesterday.
The currency consolidated today after yesterday's wild ride on the back of the RBNZ statement.
ANZ bank said the dollar had rallied as the "hawkish" RBNZ showed a stark contrast to central banks in Australia, Europe, and England, which remained on the dovish side.
Broadly speaking, the factors that had been supporting the NZ dollar remained in place. Those included a terms of trade boom, relative fiscal discipline, orientation to Asia, and relatively high interest rates, ANZ said.
That could see the NZ dollar go higher still, specially if data in the United States remained soft and European sovereign debt concerns intensified.
Overnight the euro was broadly weaker after the European Central Bank kept its 2012 inflation forecast unchanged, suggesting the pace of euro zone interest rate hikes may be slower than previously thought.
ECB President Jean-Claude Trichet did signal that the benchmark refinancing rate, now at 1.25 percent, would rise next month. But markets expected as much and had already priced in the prospect of a July hike.
Greece worries also weighed on the euro after Moody's said it would be tough to imagine private creditors participating voluntarily in a debt restructuring.
The NZ dollar was at 0.5692 euro at 5pm from 0.5604 euro at the same time yesterday after reaching a one-week high around 0.5710 euro overnight.
Against the Australian dollar, the NZ dollar was at A77.84c at 5pm from A77.38c yesterday.
It was at 66.07 yen at 5pm from 65.58 yen yesterday. The trade weighted index was 70.98 at 5pm from 70.35 yesterday.
