The New Zealand dollar made a late dash for the US46c mark yesterday afternoon and looked ready to move higher overnight.
At 5pm the kiwi traded at US46.23c, well up on Friday's close of US45.50c, while the aussie was at US53.85c, up from its close on Friday of US53.41c.
Westpac chief currency dealer Basil Payn said the kiwi's range during the day was US45.70c to US46.28c, and he picked it to trade between US46.10/60c overnight.
"Kiwi was pretty well bid during the day, we had some quite strong buying in the euro and the aussie in the afternoon" Mr Payn said.
"There was mainly buying out of Asia at that US45.80/90c level, and the market got caught short and we saw a pretty aggressive move through to US46.20c.
"It's been a negative day for the US dollar really, while the euro firmed, aussie firmed, and kiwi's gone with them. It certainly looks like good support (for the kiwi) around that US46.00c, and resistance around US46.50/60c."
The Reserve Bank of New Zealand announces its decision on interest rates on Wednesday, expected to be a no change from the current 5.75 per cent.
Also a potential market mover, Fletcher Forests shareholders vote on the proposed $1.4 billion Central North Island Forestry Partnership deal today.
"What players are doing in the market, who knows, but it's just a deal that's out there, it's something the market's looking at in terms of the overall trend of offshore investment," Mr Payn said.
In offshore trade, the greenback fell to a one-week low against the yen on Monday after failing to sustain gains reflecting a recent trend upwards on Wall Street, with the bankruptcy of US Airways Group giving bears more excuses to sell.
Dealers said the US dollar was also under pressure with expectations receding for a rate cut by the Federal Reserve on Wednesday.
The kiwi rose on all the major crosses by 5pm, to trade at A85.84c (A85.20c at Friday's close), 55.48 yen (54.93), 30.24 pence (29.65), 0.6926 Swiss francs (0.6874), and 0.4748 euro (0.4696).
The aussie was trading at $NZ1.1652 ($NZ1.1738).
On the money market, 90-day bills were at 5.89 per cent (5.89), the trade-weighted index rose to 53.20 (52.54) and the monetary conditions index tightened to minus 464 (minus 527).
On the debt market, the April 2004 bonds were at 5.61 per cent (5.60), the November 2006 bonds were at 6.04 per cent (6.04), and the November 2011 bonds were at 6.29 per cent (6.33).
- NZPA
<i>Currency:</i> Kiwi breaks back through us46c
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