The kiwi continued to gain strongly across the board today, as it eyeballed its post-float all-time high against the greenback.
At 5pm today the kiwi was at US72.37c (from US71.73c at 5pm Friday), just below it's all time high of US72.75c, which was hit in June 1998.
The kiwi came close to breaking the high last December when it hovered around US72.69c.
BNZ currency strategist Sue Trinh said US72.75c was now providing initial resistance for the kiwi. "But it looks like the kiwi may very well test that region sooner rather than later," she said.
Ms Trinh said New Zealand's interest rate story was continuing to prop up the kiwi, with offshore investors showing "insatiable demand" for yield currencies at the moment.
She said there were ongoing pressures that suggested the Reserve Bank should raise rates at least once more. She said the market was pricing in an 80 per cent chance of a 25 basis point rise next month.
The kiwi fared particularly well against the yen today, which weakened against high yielding currencies amid signs of a weak Japanese economy. The yen was weighed by last week's data that showed Japan was in a recession for the best part of 2004.
At 5pm today the kiwi was buying 76.45 yen, against 75.63 yen at 5pm on Friday.
On its other crosses the kiwi was buying A91.91c (A91.43c), 0.5545 euros (0.5487), 38.23 British pence (37.86) and 0.8569 Swiss francs (0.8493).
The Trade Weighted Index (TWI) which measures the kiwi against the currencies of New Zealand's major trading partners rose to 19-1/2 year highs. At 5pm today the TWI was at 70.31 (69.69 on Friday).
The monetary conditions index was at plus 1027 (982).
Meanwhile, the euro was at US$1.3042 (US$1.3071), and the greenback was at 105.72 yen (105.47). The aussie was at US78.69c from US78.43c at 5pm Friday.
Looking ahead this week, the market was likely to focus on data out of the US including consumer prices and real GDP figures, as well as minutes from the US Federal Reserve's policy-setting meeting from earlier in the month.
On the money markets today, 90-day bank bill yields were at 6.86 per cent (6.85), July 2009 bonds were at 6.13 per cent (6.10) and April 2015s were at 5.97 per cent (5.94).
- NZPA
<EM>Currency:</EM> Kiwi stronger across the board, nears high against US
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