The New Zealand dollar pushed close to a two-week high against the greenback, before sliding amid concerns about tax developments in the United States.News that US President Barack Obama reached an agreement to extend the Bush tax cuts for another two yea
The New Zealand dollar pushed close to a two-week high against the greenback, before sliding amid concerns about tax developments in the United States.
News that US President Barack Obama reached an agreement to extend the Bush tax cuts for another two years lifted stocks and buoyed risk appetite.
The US government's tax deal is seen as a stimulus for the economy which benefited global stocks, commodities and riskier assets.
But US Treasury yields also spiked as the tax breaks raised some concerns about the federal government's ability to meet its long term debt burden.
By 8am the NZ dollar was buying US76.01c, having peaked around US76.65c early today after climbing from about US75.80c in mid-afternoon yesterday.
BNZ currency strategist Mike Jones said the NZ dollar had surrendered its gains after the soaring US bond yields eroded part of the kiwi's yield advantage.
The kiwi was little changed against the Australian dollar at A76.95c at 8am, having dropped to a five-week low around A76.65c in late afternoon yesterday, shortly before the Reserve Bank of Australia left its benchmark rate unchanged.
ANZ Bank said the decision to leave Australian rates on hold was expected, but the dovish tone of the RBA's statement was a little surprising. It also made no mention of which direction the next move would be.
The NZ dollar rose to 63.44 yen at 8am today from 62.84 at 5pm yesterday, and was little changed at 0.5713 euro. The trade weighted index was 68.54 at 8am from 68.50.
