The New Zealand dollar closed firmer after a quiet day yesterday, with all eyes on the European Central Bank's (ECB) rates-setting meeting overnight.
The kiwi finished at 43.05USc (42.71USc Wednesday), having traded in a 42.93USc to 42.16USc range in light volumes, tracking the aussie dollar.
"We opened up round 43USc and tried to move higher, but the aussie topped out around 57.65USc so that stopped the kiwi in its tracks," a currency dealer said.
The local dollar has weakened lately as people sold in favour of the Australian dollar, but yesterday that reversed to a degree as they took profits.
"Everyone's focusing on the ECB - it's 50-50 whether they hike rates or leave them the same," the dealer said.
"That's important for the kiwi because it and the aussie currently trend in the same direction as the euro.
"Indeed, it was euro weakness that triggered the kiwi's fall to all-time lows at 42.35USc last week.
"We're going to see whether the euro can base at these levels and head higher ... or the euro continues lower and people keep buying the greenback, and aussie and kiwi keep heading lower."
The euro ended in New Zealand at 89.43USc.
The Australian dollar finished at 57.40USc (57.08c). The kiwi was buying 75.07Ac (74.79c), while an aussie dollar bought 1.3324 NZ dollars. The trade-weighted index was at 48.94 (48.58) with the 90-day bill yields at 6.66 per cent (6.68).
- NZPA
<i>Currency:</i> All eyes turn to Euro bank
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