The New Zealand dollar rose against the euro as investors digested the implications of leadership changes in France and Greece which may herald less support for Europe's austerity measures.
The New Zealand dollar rose to 61.82 euro cents from 61.06 cents yesterday. The kiwi rose to 79.44 US cents, having earlier reached its lowest level since Jan. 13 at 79.09, and was up from 79.20 yesterday. The trade weighted index decreased to 70.99 from 71.03.
Stock markets were mixed as investors pondered what impact the new Greek and French governments will have on the Euro-zone's austerity drive. In the US, the Dow Jones Industrial Average fell 0.2 per cent, France's CAC 40 index rose 1.7 per cent, and Germany's DAX 30 index increased 0.1 per cent.
France's successful presidential challenger Francois Hollande won about 52 per cent of the vote, defeating the incumbent Nicolas Sarkozy. Hollande's platform includes increased spending and slower cuts to the budget deficit, which has sparked concerns the Euro-zone may need to refinance its debt programme.
The kiwi "is in a consolidation phase at the moment - short-term it could climb back up to the 61.40 euro cent area - on the day it will probably be flat," said Alex Sinton, senior dealer at ANZ New Zealand. "The exporters of yesterday and the buyers of yesterday will be supportive and the New Zealand dollar will squeeze up a little bit higher."
