NZ dollar tops US70c overnight

The NZ dollar pushed to its highest level in four weeks against major currencies overnight as investors rediscovered a taste for risk, although the kiwi later fell away as stocks in the United States reversed earlier gains.

The New Zealand dollar pushed above US70c against the greenback for a while earlier today, although by 8am it was down to US69.60c, still up from US69.28c at 5pm yesterday.

While Moody's cut Greece's credit rating to junk status and said the country faced substantial risks, analysts said most investors had anticipated the move, which allowed them to focus instead on stronger-than-expected euro zone industrial data.

With the economic data easing concern about Europe's recovery, the euro rose against the US dollar.

The NZ dollar did squeeze to a four-week high of 0.5715 euro early today, but by 8am was down to 0.5694 euro, little different from its level at yesterday's local close.

The kiwi also peaked around 64.4 yen, falling to 63.66 by the local open which was also little changed from the level at 5pm yesterday, while against the Australian dollar the kiwi was up to A81.03c at 8am from A80.85c at yesterday's local close. The trade weighted index rose to 67.40 at 8am from 67.30 at 5pm.

BNZ strategist Mike Jones said increasing confidence that the global recovery would be sustained spurred renewed demand for growth-sensitive currencies such as the NZ dollar.

The NZ dollar had flirted with US70c for the first time in four weeks on solid demand from both real-money and speculative accounts.

- NZPA