The New Zealand dollar closed slightly lower in Wellington this evening, but could trade higher overnight following speculation kiwi denominated bonds may be issued in support.
"There's been some chatter that there's going to be issues of more kiwi uridashis," BNZ currency strategist Sue Trinh said.
Eurokiwis and uridashis are New Zealand and Australian dollar denominated bonds sold to retail investors in Europe and Japan, where central bank rates are far lower than New Zealand's 6.75 per cent and Australia's 5.5 per cent.
At 5pm in Wellington the kiwi was buying US67.59c from US67.79c at 8.30am and US67.53c at last night's local close. Its range today was US67.60c to US67.82c.
"It has again been another light one -- another tight range," Ms Trinh said.
"Basically, the markets are lying in wait for chairman Greenspan's testimony in front of Congress, but the market is still pretty much range trading ahead of that."
US Federal Reserve chairman Alan Greenspan is slated to give his semi-annual testimony on the US economy to Congress on Wednesday (Thursday morning NZT).
At 5pm the kiwi was fetching A89.94c from A89.88c at 8.30am today and A90.15c at 5pm yesterday. Against the greenback the aussie was buying US75.19c (US74.92c at 5pm yesterday).
Meanwhile, the greenback was buying 112.35 yen (112.13).
By the end of our local session the euro was sitting on US$1.2030 (US$1.2048).
Ms Trinh said she expected the kiwi to trade in a "tentative range of US67.40-US67.90" overnight.
On its crosses this evening, the kiwi was fetching 0.5622 euro (0.5605), 38.77 British pence (38.50), 0.8785 Swiss francs (0.8745) and 75.94 yen (75.80).
The TWI was at 68.75 (68.66) and the monetary conditions index at plus 932 (927).
On the money markets, 90-day bank bill yields were unchanged at 7.03 per cent. July 2009 bond yields were at 5.81 per cent (5.79) and April 2015s were at 5.75 per cent (5.73).
- NZPA
<EM>Currency:</EM> Dollar down slightly at close
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