NZ dollar tops US84c

Thursday 14th July 2011

The soaring New Zealand dollar topped US84c, its highest level in the era since it was floated in March 1985.

The New Zealand had risen modestly throughout yesterday afternoon and last night on the back of upbeat Chinese data that soothed market worries about the world's second largest economy.

Then early today the kiwi surged, topping US83.80c, after Federal Reserve chief Ben Bernanke said the Fed could resort to more monetary stimulus if the United States economy weakened further.

Shortly after 9am the NZ dollar was again driven higher after Moody's Investors Service warned the United States may lose its top-notch credit rating in the next few weeks if lawmakers fail to increase the country's debt ceiling, forcing the government to miss debt payments.

Moody's was the first among the big-three rating agencies to place the United States' Aaa rating on review for a possible downgrade, which means a negative rating action is impending.

According to Reuters data, the NZ dollar briefly topped US84.10c shortly before 9.30am, its highest level since late 1981 when the exchange rate was regulated by the central bank.

While the NZ dollar has largely been taking direction from overseas events, the market is waiting keenly for the long-delayed first quarter GDP data, due out at 10.45am today.

Comments from our readers

No comments yet