The NZ dollar held firmed a tad today to end the week firmly ensconsed above US80C.
It closed on US80.42c against its US80.37c opening and US80.50c at the same time yesterday. It traded as high as US80.66c.
It eased in early business but then spiked up quarter of
a cent after Statistics New Zealand said the economy had expanded 1 per cent in the last quarter of 2007. That was faster than the 0.8 per cent economists had forecast and analysts said a cut in interest rates is now likely to be further away.
Reserve Bank governor Alan Bollard certainly gave no indication he was in a mood to relent.
In a speech in Sydney he said he was comfortable with interest rates at the current level and signalled no rate cuts on the horizon. Domestic inflation pressures outweighed risks from international market turmoil.
While he said the bank would need to keep a close eye on global economic and financial developments for any indications global activity was slowing more than predicated, he said New Zealand's 8.25 per cent official cash rate was appropriate.
The kiwi firmed a little against the Australian dollar, ending on A87.41c from A87.38c while the trade weighted index was up to 71.31 from 71.21.
Meanwhile, the US dollar fell towards record lows against the euro and the Swiss franc as investors remain worried about widening damage to financial firms from the credit crisis.
The dollar slipped back into this week's losing streak as short-covering subsided and rumours on Thursday that Lehman Brothers Holdings Inc could suffer a fate similar to the near collapse of Bear Stearns hurt sentiment, traders said.
Lehman called the rumours "totally unfounded".
Currency rates:
NZ dlr/US dlr US80.42c US80.50c
NZ dlr/Aust dlr A87.41c A87.38c
NZ dlr/euro 0.5093 0.5087
NZ dlr/yen 80.14 79.50
NZ dlr/stg 40.05p 40.13p
NZ TWI 71.31 71.21
Australian dollar US91.99c US92.12c
Euro/US dollar 1.5793 1.5816
US dollar/yen 99.62 99.77
- NZPA
