Kiwi dollar above US74.5c

The New Zealand dollar squeaked briefly above US74.50c for the first time in more than 14 months as some good economic news pushed investors towards riskier assets.

Growing optimism of a burgeoning economic recovery saw the US dollar fall to a 14-month low against a basket of currencies as demand for riskier assets grew at the expense of the safe-haven greenback.

Traders sold the US dollar in favour of better performing assets as United States stock markets climbed on upbeat US jobs data and a surprise profit from Alcoa.

The kiwi was already on the crest of a wave from early yesterday afternoon as it rode along with the Australian currency after good jobs data from across the Tasman.

From US73.99c at 5pm yesterday, the kiwi reached US74.52c early today before easing to US74.30c by 8am.

ANZ bank said the NZ dollar was "riding in kanga's pouch".

Following the strong rise in Australian employment yesterday, two days after a surprise hike in interest rates by the Reserve Bank of Australia, it was hardly surprising the Australian dollar was flavour of the month in currency markets, ANZ said.

The aussie got close to US91c overnight, and for the NZ dollar it was "a case of being dragged reluctantly along for the ride".

At the same time, the kiwi cross against the Australian dollar had started to ease, although not remarkably so, ANZ said.

By the local open the NZ dollar was buying A82c, having traded in a tight band after stepping down half a cent when the Australian jobs data came out.

The kiwi also reached a 16-month high of 0.504 euro, easing to 0.5027 by 8am from 0.5012 at 5pm, and was up to 65.76 yen from 65.31. The trade weighted index was 66.78 at 8am from 66.59 at 5pm.

- NZPA