NZ dollar settles, investors await US data

The New Zealand dollar market settled down ahead of the release of United States monthly jobs data for November later today.

A higher than expected number was seen as a potential trigger for buying in higher-yielding currencies such as the NZ dollar.

Locally, the focus was also turning to the Reserve Bank of New Zealand's monetary policy statement next Thursday.

The NZ dollar was at US72.22c at 5pm from US72.60c at 8am and US72.68c at 5pm yesterday. It rose as far as US73c on Thursday night.

The RBNZ was expected to keep the official cash rate on hold but rhetoric will be examined for nuances.

"Depending on the tone of the statement, interest rates and the exchange rate are likely to either rise or remain unchanged - there's little chance of something coming out of the MPS that would inspire a move lower," Westpac said in a commentary.

"Even if the message intended for public consumption remains that rates are on hold until the second half of the year, investors would recognise a significant shift in the interest rate outlook further ahead and would act accordingly," Westpac said.

Upbeat eurozone retail sales data overnight added to the positive mood today.

While the European Central Bank kept rates on hold as expected at 1 per cent and outlined gradual plans to wind back its liquidity programmes, President Jean-Claude Trichet was not quite as hawkish as expected.

The US dollar dipped against the yen in Asian trading today and the euro also slipped against the yen.

The NZ dollar was at 0.4795 euro at 5pm, from 0.4816 yesterday, while against the Australian dollar it was at A78.20c from A78.16c.

It was 63.66 yen from 63.86 yen yesterday.

The trade weighted index was at 64.16 from 64.38 yesterday.

- NZPA