The New Zealand dollar rose to a three month high against the greenback after US payrolls climbed more than forecast in July, boosting demand for riskier assets.
The New Zealand dollar rose as high as 81.97 US cents following the data, the highest since April 27. It traded at 81.89 cents at 8am from 81.86 at the close of trading in New York. The trade weighted index was little changed at 73.55 from 73.52 last week.
US employers added 163,000 jobs last month, beating the 100,000 expected by economists surveyed by Bloomberg. That stoked investors' appetite for bigger returns with stocks on Wall Street gaining. The Standard & Poor's 500 index rose 1.9 percent on Friday.
Still, gains in higher-yielding assets may be short-lived if the strength of the payrolls data diminishes odds the Federal Reserve will embark on a third round of asset purchases. The Fed refrained from taking further steps to stimulate the US economy at a meeting on August 1.
"Nonfarm payrolls was certainly better than expected - that is obviously good news with risk appetite hitting the market," said Stuart Ive, currency strategist at HiFX. "If we starting seeing good data out of the US the chances of them bringing in quantitative easing will be reduced - that would mean there would be a sharp correction to the downside in the kiwi."
