Currency: NZ dollar gets lift from employment data

The New Zealand dollar got a lift today from better-than-expected unemployment data.

The unemployment rate rose to a six-year high of 5 per cent in the March quarter, but it was a smaller rise than economists forecast, which suggested to some that the Reserve Bank may not cut interest rates further.

The NZ dollar rose from US58.30c to US59.10c on the news. It was back US58.85c by 5pm, which was still up from US57.75c yesterday.

The NZ dollar rose to A78.75c but when Australian unemployment data was also better than expected it retreated to A78.10c by 5pm.

Dealers said Prime Minister John Key did not give away much in a pre-budget speech today.

Westpac senior market strategist Imre Speizer said people were being cautious about reading too much into one unemployment number but both the Australian and New Zealand unemployment numbers were significantly better than expected.

"It allows for the possibility of them (central banks) pausing," he said.

The NZ dollar was at 0.4420 euro at 5pm from 0.4352 yesterday. It rose to 57.87 yen from 56.65 yesterday. The trade weighted index rose to 57.66 from 56.94.

The NZ dollar reached a three-week high today and the Australian dollar reached a seven month high against the US dollar.

CURRENCY RATES AT 5PM

5pm today - 5pm yesterday

NZ dlr/US dlr US58.85c - US57.75c
NZ dlr/Aust dlr A78.10c - A78.40c
NZ dlr/euro 0.4420 - 0.4352
NZ dlr/yen 57.87 - 56.65
NZ dlr/stg 38.85p - 38.45p
NZ TWI 57.66 - 56.94
Aust dlr/US dlr 75.26c - 73.62c
Euro/US dlr 1.3297 - 1.3264
US dlr/yen 98.48 - 98.12

- NZPA