NZ dollar up on retail sales data

The New Zealand dollar rose today on better than expected retail sales data.

Retail sales lifted 1.1 per cent, seasonally adjusted, in August, with strongest growth in clothing and softgoods, and in fuel sales. The median forecast in a Reuters poll of economists had been for a rise of 0.5 per cent.

ANZ chief foreign exchange dealer Murray Hindley said the NZ dollar moved from around US73.45c to the day's highs around US73.95c on the retail sales data.

It was US73.68c by 5pm from US72.65c at 5pm yesterday.

"I guess we are starting to see evidence of things starting to pick up in the economy. The Reserve Bank may have to be mindful of that fact," he said.

BNZ economists said in a commentary that the gain in retail sales was broad-based.

"Today's result certainly seemed genuine enough," they said.

The Australian dollar hit a 14 month high today as investors were said to be comfortable with risk again generally as they anticipated a good reporting season in the US.

Against the Australian dollar, the NZ dollar found support around A80.50c on Tuesday night and recovered to be A81.20c by 5pm today.

The NZ dollar was 0.4986 euro at 5pm from 0.4941 at 5pm yesterday, and was up to 66.24 yen from 65.46. The trade weighted index was 66.49 from 65.71 yesterday.

The US dollar was mostly on the defensive in subdued trading in Asia.

- NZPA