NZ Dollar: Kiwi strengthens against weaker greenback

The New Zealand dollar strengthened as a stock rally in the United States lifted investor risk appetite, while worries that automaker Chrysler may be nearing bankruptcy hit the greenback.

By 8am today the kiwi was buying US57.21c, up from US56.20c at 5pm on Friday, having reached a week high around US57.35c on Saturday morning.

BNZ Capital currency strategist Danica Hampton said that for the most part the NZ dollar was simply driven higher against the US dollar by a generally weaker greenback.

The decision on interest rates to be released by the Reserve Bank of New Zealand on Thursday would take centre stage this week, she said.

While the global backdrop would remain an important influence on the kiwi against the US dollar, the risks were skewed in favour of the NZ dollar heading lower into Thursday's interest rate announcement.

The NZ dollar rose across the board, lifting to 0.4319 euro at 8am today from 0.4275 at 5pm on Friday, and up to 55.57 yen from 54.55.

Against the Australian dollar, the kiwi lifted to A79.09c at today's local open from A78.86c, with the trade weighted index up to 56.64 at 8am today from 55.93 at 5pm on Friday.

The euro rose against the US dollar for a fourth straight session as improved business sentiment in Germany added to hopes that the euro-zone economy may already have seen the worst of the recession.

- NZPA