NZ dollar steady, looks to lift

File Photo / Dean Purcell

The New Zealand dollar was little changed from its opening level today but US dollar weakness remains an ongoing theme after an unexpected drop in United States payrolls in September.

The NZ dollar was at US75.48c at 5pm from US75.64c at 8am. It had risen during the weekend after the US employment report on Friday US time.

The employment weakness in the US bolstered expectations of further easing by the Federal Reserve to revive a spluttering economy. This is expected to ensure that the US dollar's weak trend remains intact as the Fed's quantitative easing measures involve asset purchases meant to push long term yields lower.

"A rising tide lifts all boats whether in good condition or not. The only question is whether this move is tidal or tsunami-like," Westpac said in its weekly forex outlook for the NZ dollar.

It said that having pushed through US74c the NZ dollar market will be targeting a move back to the October high last year of US76.35c. Beyond that the next target level is US77c.

The Australian dollar has also been rising against the US dollar and is expected to reach parity soon. It was at US98.65c at 5pm from US98.36c at 5pm on Friday.

But the NZ dollar continues to be weak on a range of crosses.

It was at A76.48c at 5pm from A76.51c at the same time on Friday.

Against the European currency, the NZ dollar fell from 0.5395 euro at 5pm on Friday to around 0.5340 early on Saturday, then it changed direction and by 5pm today was at 0.5403.

ANZ bank said the US employment data, along with the Columbus Day long weekend in the US, ensured enough volatility for all.

It was at 61.91 yen from 61.96 yen on Friday.

The trade weighted index lifted to 66.95 at 5pm from 66.89 at the same time on Friday.

- NZPA