Dollar gains against Aussie after RBA speech

The NZ dollar gained against the Australian dollar today after Reserve Bank of Australia (RBA) deputy governor Ric Battellino said the overall stance of Australian monetary policy was back in a normal range.

This pushed the Australian dollar down to US89.89c at 5pm from US91.34c at the same time yesterday and the NZ dollar went for a ride lower as well to US71.76c at 5pm from US72.64c yesterday.

The NZ dollar rose toward A80c today and was A79.82c at 5pm from A79.53c yesterday.

"Basically the RBA has wound back what people might think in relation to interest rates over there," one dealer said.

He said the Australian dollar appeared to have support around the US90c figure and whether or not it held overnight was a focus of investors.

The US dollar was little changed around two and a half month highs against the euro in Asian trading today ahead of a statement from the US Federal Reserve later in the day.

Data showed US producer prices rose 1.8 per cent last month, the largest gain in three months. That pushed up US bond yields and came on the heels of stronger US employment and consumer spending data.

The NZ dollar fell to 64.27 yen from 64.49 at 5pm yesterday, and was lower at 0.4938 euro from 0.4958 yesterday. The trade weighted index dropped to 64.99 from 65.29 yesterday.

- NZPA