Kiwi rises back above US78c

Monday 11th April 2011

The New Zealand dollar rose to around two-month highs against the greenback above US78c, as the US currency and yen continued to be weak.

The NZ dollar was at US78.31c at 5pm from US78.26c at 8am and US78.22c at 5pm on Friday. The currency consolidated at slightly lower levels for most of the session but rose during the afternoon.

"Global risk sentiment remains strong and the US dollar remains unloved. These factors explain much of the strength in the NZ dollar since mid-March, and will be influential during the next few weeks," Westpac said.

ANZ bank said the NZ dollar had "an almost too strong finish to the trading week" last week as demand out of the US continued to push the Australasian currencies higher. The NZ dollar lay beneath tough topside levels.

The Australian dollar was near recent highs against a weak yen. The yen is weak because the Bank of Japan is keeping monetary policy loose to help the economy recover from last month's massive earthquake.

The NZ dollar eased to A74.06c from A74.14c at 8am today from A74.29c at 5pm on Friday, and dropped to 0.5414 euro from 0.5436 on Friday.

It was at 66.35 yen from 66.52 yen on Friday. The trade weighted index dropped to 68.02 from 68.13 on Friday.

In the US a last-minute budget deal, announced mid-afternoon Saturday (NZT), averted an embarrassing US government shutdown, cut US$38.5 billion (NZ$49.2 billion) in spending and provided the first major test of the divided government that voters ushered in five months ago.

NZPA

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