Dollar still near US70c

Though the New Zealand dollar slipped a little from the new 12-month highs it hit against the US dollar early today, it finished the day up near US70 cents.

At 5pm today the kiwi was worth US69.78.

It stepped over the US70c barrier at 2am but after peaking at US70.07c fell off steadily over the next six hours.

The kiwi dipped sharply, but only briefly, to US69.22 on the Reserve Bank monetary policy statement at 9am. However, within half an hour of the statement it recovered and stayed near the level it finished at 5pm.

The Reserve Bank said that it was not cutting the official cash rate and that it expected it to be on hold until late in 2010.

"We are seeing more short-term recovery... but we regard that as short-term and really fragile," said Reserve Bank Governor Alan Bollard.

Despite the central bank's concerns about stalling that fragile recovery, financial market commentators said they still expect to see the cash rate lifted around March next year.

The US dollar was trading near one-year lows against a major currency basket, as growing evidence of a global recovery spurred investors to move into riskier currency trades.

The NZ dollar hit a six-year low in early March but has grown about 40 per cent since, helped by overseas investors boosting their exposure to higher-yielding currencies.

At 5pm, the kiwi was at .4786 euro, up on the .4804 it was trading at yesterday at 5pm.

The NZ dollar rose against the Australian dollar, from 80.95 last night to 81.11 tonight, but at 5pm was at 64.12 against the yen, from 64.24 at the same time yesterday. It was worth 42.15 pence against the British pound, just above the level at 5pm yesterday.

The trade weighted index was 64.12 at 5pm, up from 63.84 yesterday evening.

- NZPA