Tuesday 11th January 2011
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The New Zealand dollar firmed against the currencies of the US and Australia, and pushed back to be near five-year highs against the euro after an overnight dip.
At 8am today the NZ dollar was buying US76.47c from US76.13c at 5pm yesterday, and was up to A76.70c from A76.44c. Early today the kiwi peaked at a one-month high A76.85c.
BNZ currency strategist Mike Jones said the NZ dollar had been weighed down by a mild paring in investors' risk appetite early in the overnight session.
Chinese trade data yesterday had been "fairly uninspiring", while fears above the health of euro zone economies continued to percolate.
But the NZ dollar had soon been heading higher against the US dollar as global stocks and commodity prices clawed back part of their early losses, bolstering demand for commodity-sensitive currencies.
ANZ said weaker Australian retail sales data for November had given the market confidence that the Reserve Bank of Australia was likely to remain on hold for now. That helped break through resistance at A76.55c overnight and provided a lift to that cross.
The NZ dollar was also buying 0.5901 euro at 8am, the same as its level at 5pm, and was little changed on 63.31 yen. The trade weighted index was up to 69.30 at 8am from 69.14 at 5pm.
The euro recovered some losses against the greenback after it had fallen to a four-month low against the US currency, though gains could be temporary given concerns about indebted euro zone countries and talk Portugal will need a bailout.
The recovery in the euro was partly helped by gains against the Swiss franc on speculation the Swiss government may take new measures to rein in currency strength.
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