WELLINGTON - The New Zealand dollar eased today as the US dollar rebounded after it appeared the market had misread last week's statements on interest rates from the US Federal Reserve.
At 5pm the kiwi was buying US63.45c, well shy of a six-week high of US64.27c hit yesterday, and down on last night's US63.80c local close.
In the absence of local data, the market was focused on offshore developments, including a CNBC television report quoting Fed chairman Ben Bernanke as saying that the central bank had a flexible stance on monetary policy, not a dovish one as was widely reported last week.
That saw the US dollar extend its rebound from a one-year low against the euro and a seven-month low versus the yen.
The greenback was also buoyed by US figures that showed strong factory growth and a pickup in inflation -- challenging a view in the market that the Fed was about to end a two-year run of raising rates.
The Australian dollar also consolidated today as investors awaited the outcome of a Reserve Bank of Australia rate-setting meeting.
The decision is due out at 11.30am tomorrow NZT, with a median 40 per cent of those surveyed by Reuters expecting the bank to hike its official rate by 25 basis points to 5.75 per cent.
The Australian unit was trading at US75.63c by 5pm compared with US75.95c late yesterday.
The New Zealand dollar trade-weighted index eased to 63.68 from 63.85 yesterday.
Rates:
5pm today 5pm Monday
NZ dlr US63.45c US63.80c
NZ dlr/Aust dlr A83.92c A83.98c
NZ dlr/euro 0.5045 0.5052
NZ dlr/yen 72.17 72.20
NZ dlr/stg 34.79 34.92
NZ TWI 63.68 63.85
Australian dollar US75.63c US75.95c
Euro/US dollar US1.2580 US1.2526
US dollar/yen 113.73 113.18
NZPA
<EM>Currency: </EM>Kiwi softens as US dollar regains form
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