Dollar unable to hold onto gains

The New Zealand dollar pushed above US74c for several hours overnight but was unable to hold onto the gains and may be looking tired.

By 8am the kiwi was buying US73.81c, having briefly topped US74.30c last night after climbing from US73.99c at 5pm.

ANZ bank said the NZ dollar had failed to kick on when it was above US74c, despite further gains by US equities and downward pressure on the greenback.

"A clear sign of exhaustion on the part of the kiwi perhaps, and recognition that the bird does not have wings and therefore can't stay in the sky for too long."

Higher New Zealand government deficits and official comments had weighed on the kiwi, ANZ said.

The greenback slumped to a fresh 14-month low against the euro as soaring quarterly profits at JPMorgan Chase boosted market optimism and whetted investor appetite for higher-yielding currencies and assets.

Minutes from the Federal Reserve's last policy meeting showed officials did not consider inflation an imminent threat, undermining the US dollar as they suggested interest rates would remain low well into 2010, despite an improved US outlook.

The kiwi slipped to 0.4952 euro at 8am from 0.4970 at 5pm, and was down against the Australian dollar to A80.75c from A80.99c, while lifting to 66.04 yen from 65.80. The trade weighted index was 66.19 at 8am from 66.37 at 5pm.

Statistics New Zealand is due to release consumers price index figures for the September quarter at 10.45am today.

- NZPA