NZ dollar little changed

Monday 13th December 2010

The New Zealand dollar was little changed when foreign exchange trading started for the week, having been the weakest performing currency last week.

BNZ currency strategist Mike Jones said that tumbling interest rate differentials between this country and the US, along with a sharp sell off in the kiwi against the Australian dollar, dragged the NZ dollar from above US76.50c to around US74.80c.

NZ-US interest rate differentials had fallen away sharply as US bond yields surged as nascent improvements in the US economy continued, and a deal appeared to be reached on extending US tax breaks.

Around 9.15am today the NZ dollar was buying US74.82c from US74.95c at 5pm on Friday. The kiwi was barely changed at 0.5650 euro, and at 62.68 yen.

The NZ dollar slipped to A75.89c against the aussie around 9.15am from A76.05c on at 5pm on Friday. The trade weighted index fell to 67.59 from 67.73.

ANZ said the NZ dollar closed the week with range bound trading, after trying unsuccessfully to move both sides of its recent range.

Today, the Australasian currency basket may have an indecisive start as analysts look to decide on the impact of higher Chinese inflation, ANZ said.

NZPA

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