NZ dollar holds overnight gains in holiday market

Thursday 30th December 2010

The New Zealand dollar was firm today after rising overnight to the highest level since November 23 as investors were again comfortable with risk.

The NZ dollar was at US76.71c at 5pm from US76.56c at 8am and US75.81c at 5pm yesterday.

Mike Jones, currency strategist at BNZ, said the currency held near the overnight high around US76.90c in the quiet holiday market today.

The NZ dollar was being driven by a range of factors, including firm commodity prices, risk appetite and a widening in the spread between New Zealand and United States interest rates after yields fell in the United States.

There was year-end position squaring in some currencies but Jones said the NZ dollar market was long, so squaring was likely to push the currency lower, rather than higher.

The NZ dollar pushed higher against the Australian dollar even though the latter currency is performing strongly itself against the greenback.

The New Zealand dollar was at A75.40c at 5pm from A75.27c at 8am and A75.02c at 5pm yesterday.

The NZ dollar was at 62.44 yen at 5pm today from 62.37 yen yesterday.

The trade weighted index was at 68.72 from 68.29 yesterday.

NZPA

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