NZ dollar firms as effects of RBA interest-rate move wear off
The New Zealand dollar firmed across the board overnight with yesterday's negative effect of the Reserve Bank of Australia's official cash rate decision soon wearing off.The kiwi rose to 71.26USc at 8am from 70.58USc at 5pm yesterday.Most commentators had
The New Zealand dollar firmed across the board overnight with yesterday's negative effect of the Reserve Bank of Australia's official cash rate decision soon wearing off.
The kiwi rose to 71.26USc at 8am from 70.58USc at 5pm yesterday.
Most commentators had expected the RBA to lift its official cash rate 25 basis points, but it left the rate unchanged at 3.75%, which saw the Australian dollar dip against other currencies and dragged the kiwi down yesterday.
ANZ Bank said in its morning brief that the RBA delivered only a temporary setback for the kiwi yesterday as it found offshore demand at 70.35USc.
Resumption of the path higher continued overnight but the currency avoided sellers at 71.45USc.
Further tests of the topside were possible as market positioning appeared to dominate.
"Selling interests above 0.7145 may be tested but the NZD should have difficulty closing on highs due to upcoming data," ANZ senior interest rate strategist David Croy said.
The NZ dollar had firmed to 80.40Ac at 8am from 80.09Ac at 5pm, and was at €0.5102 from €0.5080 and ¥64.40 from ¥64.04.
The trade weighted index rose to 65.57 from 65.20.
Reuters reported that the US dollar weakened as strong corporate earnings and improving economic data convinced investors to wade temporarily into riskier assets and currencies where returns are higher.
Wall Street shares advanced while commodities gained, helping boost commodity-linked currencies.
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