The New Zealand dollar edged higher against all its major crosses today, as expectations firmed that New Zealand would not cut its interest rates in the near future.
At 5pm the kiwi dollar was buying US61.82c, a jump of more than half a cent from US61.18c at yesterday's close.
Other factors in the kiwi's rise included a weaker US dollar, political tension in Australia and the expiry of options.
"Sentiment is still quite negative, but there's enough appetite around, particularly from offshore, to suggest the kiwi dollar in the nearer term is going to find reasonable support," BNZ forex manager Mike Symonds said.
He said the market was continually reappraising any easing of interest rates here and although the data was mixed, the kiwi looked likely to trade in broader ranges than it had recently.
The kiwi seems supported around US60.60c, with a risk to the upside of US62.20/50c area.
Also supporting the currency were comments from the Finance Minister Michael Cullen, who said he was expecting a "soft landing" for the economy.
He expected the economy to slow in the second half of the year, but that the lower exchange rate would trigger a pick-up in growth.
The kiwi also improved against currencies from other major trading partners at A82.05c from A81.45c, 0.4845 euro from 0.4803, and 70.70 yen from 69.81. The TWI was at 61.85 from 61.26.
Offshore, the US dollar edged up against the euro and the yen on Wednesday but stayed in sight of one-month lows ahead of tomorrow's US May trade data.
The euro was a cent off its one-month high of $1.2865, while the yen was steady ahead of a Bank of Japan meeting later in the week, which is expected to result in the first rise in Japanese interest rates in six years.
- REUTERS
<i>Currency:</i> Interest rate expectations support kiwi dollar
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