The high-yielding New Zealand dollar continued its recent strong run, hitting six-and-a-half month highs against the Australian and US dollars, ahead of a raft of data this week.
By 5.30pm, the kiwi was at A88.69c from A87.31c late on Friday, and US66.76c from US66.04c on Friday. The currency has recovered from a tumble on last week's current account surprise, showing the deficit grew to an estimated 9.7 per cent of gross domestic product for the year ended June.
"However, post-current account losses were short-lived, indicating that underlying NZD sentiment remains positive," Bank of New Zealand currency strategist Danica Hampton said.
"Indeed, the combination of yield-hungry investors and the RBNZ's surprisingly hawkish September MPS (monetary policy statement) continues to see the NZD well supported on dips towards US65.50 cents," she said.
The Reserve Bank of NZ presides over the highest central bank interest rates in the developed world, at 7.25 per cent, and warned earlier this month there was no prospect of a rate cut for some considerable time.
The central bank will be watching second quarter gross domestic product data on Friday, following monthly trade figures, the Westpac-McDermott Miller consumer confidence and National Bank business outlook on Tuesday, Wednesday and Friday respectively.
The US dollar edged down on growing expectations that a slowing US economy could prompt the Federal Reserve, which held rates at 5.25 per cent at a policy meeting last week, to cut interest rates next year.
The following are Reuters currency rates:
5.25pm today 5pm Friday
NZ dlr/US dlr US66.76c US66.04c
NZ dlr/Aust dlr A88.69c A87.31c
NZ dlr/euro 0.5211 0.5162
NZ dlr/yen 77.65 76.83
NZ dlr/stg 35.06p 34.70p
NZ TWI 66.78 66.04
Australian dollar US75.23c US75.61c
Euro/US dollar 1.2810 1.2791
US dollar/yen 116.35 116.34
- NZPA
<i>Currency:</i> Kiwi boosted by yield-seekers
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