The New Zealand dollar continued to trade above US66c today in the wake of strong anti-inflation talk from Reserve Bank governor Alan Bollard last week.
Shortly after 5pm today the NZ dollar was worth US66.15c from US66.00c at 5pm on Friday.
It had reached US66.59c on Thursday after the RBNZ warned it may have to raise interest rates again to contain inflation.
Against the euro, the NZ dollar was at 0.5224 from 0.5185 on Friday evening, and against the yen it was at 77.95 from 77.50.
The trade-weighted index was at 66.59 from 66.24.
Against the Australian dollar it was at A87.81c, having reached toward A88.30c - a six-month high - early on Saturday. It was around A85.70c on Thursday just before Dr Bollard's comments and A87.33c at 5pm Friday.
ANZ Bank said Dr Bollard's message was reinforced overseas by Reserve Bank assistant governor Grant Spencer, suggesting interest rates would be raised if key economic data exceeded the Reserve Bank's expectations.
Particular attention would be paid to housing and labour market data.
The comments would fuel more buying demand this week despite the looming release of New Zealand's second quarter current account data on Thursday.
ANZ said perhaps the new Reserve Bank of Australia governor would provide some lift for the aussie and slow the ascent of the cross.
"While the RBNZ's stance is very hawkish it will be difficult to reverse this cross," ANZ said.
Another analyst said the RBNZ was very hawkish last week, and that was still dominating sentiment, while the US looked to be at the top of its interest rate cycle.
On Thursday, Dr Bollard left the Official Cash Rate unchanged at 7.25 per cent in his quarterly review of monetary conditions but he threatened more rate hikes after having ruled that out in March.
The market still remains surprised at the strength of Dr Bollard's stance.
The following are Reuters currency rates:
5pm today 5pm Friday
NZ dlr/US dlr US66.15c US66.00c
NZ dlr/Aust dlr A87.81c A87.33c
NZ dlr/euro 0.5224 0.5185
NZ dlr/yen 77.95 77.50
NZ dlr/stg 35.17p 35.06p
NZ TWI 66.59 66.24
Australian dollar US75.28c US75.56c
Euro/US dollar 1.2663 1.2725
US dollar/yen 117.85 117.45
- NZPA
<i>Currency:</i> Kiwi dollar trades above US66c
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