NZ dollar climbs through US74c

The New Zealand dollar rose through the US74c figure today after a "monster" employment report in Australia increased optimism about economies in this part of the world.

The NZ dollar was US73.99c at 5pm from US73.33c at 8am and US73.40c at 5pm yesterday. It rose to US74.25c today, a level not seen since August last year.

But the NZ dollar lost ground against a surging Australian dollar to be A81.99c at 5pm from A82.54c at the same time yesterday. Australia's unemployment rate was 5.7 per cent in September and total employment rose by 40,600 in the month. The market was expecting a 6 per cent rate and 10,000 fall in employment.

The Australian dollar rose to US90.21c at 5pm from US88.90c at the same time yesterday on the report.

"The aussie data was a monster number. It was a big positive surprise by anyone's measure," Westpac senior market strategist Imre Speizer said.

The data made the Reserve Bank of Australia look like it was on the ball when it raised interest rates this week, and increased anticipation of rate rises elsewhere in this part of the world, which is seen as decoupled from the US economic story.

The market was starting to pre-empt rate rises, Mr Speizer said.

BNZ said the NZ dollar was rising on the coat tails of the Australian dollar.

"The NZ dollar is well ahead of where fundamentals suggest it would normally be, but these remain abnormal times and there still seems nothing on the horizon likely to generate a significant pull back," BNZ said.

The NZ dollar reached a 16-month high against the European currency at 0.5040 euro today and was 0.5012 by 5pm.

The NZ dollar rose to 65.31 yen from 65.17 at 5pm yesterday, and was just above 46p, having reached a 25-year high 46.55p overnight. The trade weighted index was 66.59 at 5pm from 66.42 yesterday.

- NZPA