Dollar settles just over US71c

The New Zealand dollar eased from recent highs today.

Dealers said the session was a quiet one as the NZ dollar drifted ahead of the weekend. A quiet week is also in prospect next week with several holidays in offshore markets.

The NZ dollar rose to 13-month highs around US71.55c this week but was back at US71.02c at 5pm today from US71.32c at the same time yesterday.

The US dollar rose against the euro today an investors covered short positions established during a period of US dollar weakness.

The Australian dollar fell to US87.09c at 5pm from US87.42c at the same time yesterday.

So there were few reasons for the NZ dollar to push on today.

The NZ dollar was little changed at A81.51c at 5pm from A81.59c at the same time yesterday.

BNZ Capital senior strategist Danica Hampton pointed to comments by Bank of Japan Governor Masaaki Shirakawa that a stronger yen might support the Japanese economy in the longer run.

Those comments provided a bit of support for the yen and encouraged a bout of profit-taking from investors who had bought NZ dollars against yen, Ms Hampton said.

The NZ dollar sank from around 65.20 yen to below 64.60, setting the scene for a softer kiwi against the US dollar. It was 64.78 yen at 5pm from 65.02 at the same time yesterday.

The trade weighted index was 64.65 at 5pm from 64.83 yesterday.

Reuters currency rates:

5pm today 5pm yesterday

NZ dlr/US dlr US71.02c US71.35c

NZ dlr/Aust dlr A81.51c A81.59c

NZ dlr/euro 0.4824 0.4845

NZ dlr/yen 64.78 65.02

NZ dlr/stg 43.32 43.26

NZ TWI 64.65 64.83

Aust dlr/US dlr 87.09c 87.42c

Euro/US dlr 1.4717 1.4725

US dlr/yen 91.22 91.09

- NZPA