NZ dollar firms against US, Australian currencies

The New Zealand dollar has firmed against the currencies of the US and Australia, pushing back to be near five-year highs against the euro after an overnight dip.

NZPA and NBR staff
Tue, 11 Jan 2011

The New Zealand dollar has firmed against the currencies of the US and Australia, pushing back to be near five-year highs against the euro after an overnight dip.

At 8am today the NZ dollar was buying 76.47USc from 76.13USc at 5pm yesterday, and was up to 76.70Ac from 76.44Ac. Early today the kiwi peaked at a one-month high 76.85Ac.

BNZ currency strategist Mike Jones said the kiwi dollar had been weighed down by a mild paring in investors' risk appetite early in the overnight session.

Chinese trade data yesterday had been "fairly uninspiring," while fears above the health of euro zone economies continued to percolate.

But the NZ dollar had headed higher against the US dollar as global stocks and commodity prices clawed back part of their early losses, bolstering demand for commodity-sensitive currencies.

ANZ said weaker Australian retail sales data for November had given the market confidence that the Reserve Bank of Australia was likely to remain on hold for now. That helped the kiwi break through resistance at 76.55Ac overnight.

The NZ dollar was also buying €0.5901 at 8am, the same as its level at 5pm, and was little changed on ¥63.31. The trade weighted index was up to 69.30 at 8am from 69.14 at 5pm.

The euro recovered some losses against the greenback after it had fallen to a four-month low against the US currency, though gains could be temporary given concerns about indebted euro zone countries and talk that Portugal will need a bailout.

The recovery in the euro was partly helped by gains against the Swiss franc on speculation the Swiss government may take new measures to rein in currency strength.

NZPA and NBR staff
Tue, 11 Jan 2011

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NZ dollar firms against US, Australian currencies