Kiwi stronger after dip on lower commodities prices

Tuesday 29th March 2011

A broadly stronger euro helped pull the New Zealand dollar from overnight lows, as currency markets had relatively little news to add into their calculations.

By 8am today the kiwi was buying US75.32c from US75.04c at 5pm yesterday, while being little changed at 0.5343 euro.

BNZ currency strategist Mike Jones said the NZ dollar spent the first part of the night dribbling lower against the greenback, as modest declines in commodity prices sapped demand for growth-sensitive currencies.

Later in the overnight session, a rebound in the euro helped drag the kiwi back above US75c.

The NZ dollar edged higher from 61.37 yen at 5pm to 61.50 at 8am, and from A73.12c against the aussie to A73.29c. The trade weighted index lifted to 66 at 8am from 65.88 at 5pm.

The euro outperformed most major currencies, as investors believe tighter monetary policy by the European Central Bank is around the corner.

ECB President Jean-Claude Trichet said inflation rates were durably above the central bank's price stability target.

NZPA

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