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NZ dollar lower on weaker risk sentiment


The New Zealand dollar continued slipping and sliding against the greenback, a slump which began after it spiked to US81.71c on Friday night.

NZPA
Mon, 27 Jun 2011

The New Zealand dollar continued slipping and sliding against the greenback, a slump which began after it spiked to US81.71c on Friday night.

Falling through the weekend, it rallied a briefly early today but was down to US80.24c at 5pm, compared with US81.31 at the same time on Friday.

The New Zealand dollar -- and its Australian counterpart -- were both the victims of concerns about Greece's debt woes and weak equities weighed on risk trades.

NZ currency strategist Mike Burrowes said the NZ dollar's rollercoaster ride on Friday night was also cut back as risk sentiment was hit by further concerns about the European debt saga.

Despite that, the NZ dollar held up better against the safe havens of the Swiss franc, Japanese yen and US dollar, than any of the other major currencies, Mr Burrowes said.

The resilience of the NZ dollar had been a consistent theme during the past week, with a recent rise in New Zealand interest rate differentials likely to be a key factor.

The Aussie fell to 11-week lows against the greenback, while the NZ dollar lost a full $US1c from late New York levels to dip as low as US80.10 at lunchtime today, before consolidating later in the afternoon.

A lower trade balance than had been expected for New Zealand in May, helped to bring the annual surplus down toward NZ$1 billion.

It was also down to A77.05c at 5pm against the Australian dollar, which was A77.18c on Friday.

It lost even more ground against the euro, trading at 0.5682 euro at 5pm, from 0.5703 at the start of the weekend.

ANZ said questions about Greece and other countries within the European Union should increase the chances of lower levels for the NZ dollar that would find familiar support.

The NZ dollar was down to 64.83 yen at 5pm today from 65.47 at 5pm on Friday, while the trade weighted index fell to 69.99 points from 70.51.

The euro dropped against the US dollar for a third straight session on Friday (local time) and hit a record low against the Swiss franc, with more losses expected if Greece's parliament doesn't approve a package of austerity measures this week. At 5pm it was $US1.4124c, from $US1.4261c on Friday, and the Aussie was $1.0416 at 5pm, from $1.4261 last week.

NZPA
Mon, 27 Jun 2011
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NZ dollar lower on weaker risk sentiment
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