The New Zealand dollar continued to hang onto its position above the US42c mark, but an uneventful week ahead is likely to keep the lid on further short-term gains.
Trade was quiet today, the kiwi closing near the top of its tight 11-point range at US42.23c. It closed on Friday at US42.09c.
Dealers said the kiwi was holding its own against a robust aussie dollar but could possibly weaken overnight. The aussie closed today at US51.77c, compared to US51.62c on Friday and observers said it was headed towards US52c.
With a US public holiday starting tonight, and little in the way of data due this week, the kiwi was expected to cruise at current levels.
But Westpac chief dealer in Wellington, Basil Payn said that as long as the kiwi held above US41.80c this week then there was a good chance it would test a higher range with a tilt at US43c possible.
Tonight, however, the kiwi dollar was expected to trade more conservatively, between US42.10-40c.
On the kiwi crosses, the New Zealand dollar was buying A81.58c (A81.82c at Friday's close), 55.97 yen (55.87), 29.47 pence (29.43), 0.7169 Swiss francs (0.7150), and 0.4837 euro (0.4822). The aussie was buying $NZ1.2258 (1.2251).
The trade weighted index closed at 51.31 (51.22), the monetary conditions index at minus 738 (minus 751), and 90-day bank bills at 4.95 per cent (4.92).
On the debt market bond yields fell sharply. The April 2004 bonds were at 5.70 per cent (5.82), November 2006s at 6.35 per cent (6.41), and November 2011s at 6.60 per cent (6.67).
- NZPA
<i>Currency:</i> Kiwi clings to last week's gains
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