The New Zealand dollar closed on its highs for the day, having traded in a narrow range today, but was well shy of a six-week peak touched earlier in the week.
At 5pm, the kiwi was buying US64.13c, compared with yesterday's US63.84c local close, at the top of its US64.85c to US64.13c range for the day.
That was well below a peak of US64.45c reached on Monday.
On the local data front, a survey by Roy Morgan Research showed consumer confidence fell to 104.8 at the beginning of May, down 15.2 points on April and the lowest level since the survey began in January 2004.
A net 25 per cent expected the economy to worsen over the next 12 months, compared with a net 11 per cent a month earlier.
New Zealand government account data today showed the government's operating surplus for nine months to March 31 was 60 per cent above forecast, while net government debt stood at 5.7 per cent of GDP.
Meanwhile, a report from the International Monetary Fund today said New Zealand's economic growth was forecast to slow to 0.9 per cent this year from 2.2 per cent in 2005, but it has substantial room to manoeuvre on monetary policy with inflation likely being little changed from 2005.
Inflation was projected at 3.1 per cent in 2006 compared with 3.0 per cent the year before, the IMF said.
"With underlying inflation likely on a downward path, monetary policy tightening has paused for the time being, and there is substantial room for manoeuvre if the economy slows too abruptly," the IMF said in a statement.
Next week should provide more local direction for the kiwi, with New Zealand wage data due on Monday and jobs data on Thursday.
The Australian dollar rose to US76.90c from US76.75c late yesterday, but was down on an intraday high of US77.26c.
Australia's central bank today said it expected the dampening effect of this week's increase in interest rates to restrain inflation, suggesting it currently saw no need for another tightening in policy.
In its quarterly Statement on Monetary Policy, the Reserve Bank of Australia (RBA) reiterated that rising risks to inflation had warranted a quarter of a percentage point rise in interest rates to 5.75 per cent, the first hike in 14 months.
The NZ-Australian dollar cross rate improved to A83.39c from A83.19c.
- NZPA
<EM>Currency:</EM> NZ dollar closes on its highs
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