KEY POINTS:
Having hit another post-float high against the greenback around lunchtime yesterday, the New Zealand dollar eased through the early hours of this morning.
From US76.64c at 5pm yesterday, the kiwi got as low as US76.36c around 7am today before staging a slight recovery to be buying US76.45c at 8am.
The kiwi hit US76.84c yesterday, its highest level against the US dollar since being allowed to float in March 1985.
Overnight the greenback traded little changed against most major currencies ahead of a two-day Federal Reserve policy meeting which investors will look to for clues on where benchmark US interest rates are headed. The meeting ends on Thursday (local time).
This week has some key New Zealand data, including trade and consumer confidence tomorrow, current account on Thursday and gross domestic product and National Bank's business outlook on Friday.
ANZ bank today said that after yesterday's peak, the NZ dollar overnight remained within a relatively narrow range awaiting the outcome of this week's data.
Investors' addiction to yield meant concerns about increased volatility and growing risk aversion overseas were being put to one side as demand continued to drive the kiwi, ANZ said.
While the NZ dollar's fortunes later this week would be dictated by the economic data flow, any signs of US dollar weakness due to subprime and housing market concerns could see the kiwi still flying high.
The NZ dollar also eased against the euro overnight, from 0.5692 at 5pm yesterday to 0.5678 at 8am today, and against the yen from 94.93 to 94.47. The trade weighted index was at 74.35 this morning from 74.52.
But the kiwi remained in a narrow range against the Australian dollar overnight, between the A90.10c and A90.40c levels. At 8am today it was buying A90.33c, compared to A90.27c at 5pm yesterday.
ANZ said the relative strength of the NZ dollar had ensured the cross against the aussie remained in neutral and should do so again today.
Investors face plenty of fresh US economic data this week and will pay particular attention to durable goods orders figures for May on Wednesday (local time) and to core personal consumption expenditures data on Friday (local time), also for May.
Currency rates:
(8am today )
NZ dlr/US dlr US76.45c
NZ dlr/Aust dlr A90.33c
NZ dlr/euro 0.5678
NZ dlr/yen 94.47
NZ dlr/stg 38.27p
Cross rates:
Australian dollar US84.63c
Euro/US dollar 1.3465
US dollar/yen 123.58
- NZPA