The New Zealand dollar closed at a one-week high today as it made the most of weakness in its United States counterpart.
At 5pm, the New Zealand dollar was buying US56.00c, up from US55.74c at 5pm yesterday, while the aussie was at US62.31c (US61.98c).
The Australian dollar is outperforming the kiwi, hitting a 26-month high of US62.42c during the day. Against the aussie the kiwi has fallen from a 7-1/2 year high in February of A93.97c to today's close of A89.88c (A89.93c).
One local dealer said the kiwi was well supported at US55.80c, and had seen good volumes today.
"The US dollar in general has lost ground against most currencies and we've benefited from that. There has been good two-way interest though," he said.
The kiwi traded between US55.75c and US56.06c during the day.
"I think probably US55.80c should hold it on the down side (overnight) and maybe we'll have a look up towards the US56.10/20c region.
"There's positivity out there on the aussie and kiwi thanks to the weaker US dollar offshore. At this stage there hasn't been much retracement on the downside after these big moves higher, so you'd expect to see a bit of extension," he said.
The kiwi made its break overnight on the back of a surging euro as the greenback failed to make headway following good news from the US consumer sector.
The euro, which reached a four-year high of $US1.1135 in Asia today, was at $US1.1110 in Wellington at 5pm ($US1.0996 yesterday). The US dollar was buying 119.61 yen (119.93 yen).
On the crosses at 5pm, the kiwi was buying 66.97 yen (66.85), 35.11 pence (35.05), 0.7622 Swiss francs (0.7635), and 0.5042 euro (0.5069).
The monetary conditions index was at 170 (168), the trade-weighted index was at 60.85 (60.81) and 90-day bank bill yields were unchanged at 5.52 per cent.
The February 2005 yields were at 5.19 per cent (5.20), the November 2006s were at 5.39 per cent (5.38), and the November 2011s were at 5.84 per cent (5.82).
- NZPA
<i>Currency:</i> Kiwi breaches US56c but underperforms Aussie
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