The New Zealand dollar ended the week on a positive note as several local banks moved to shore up year-end positions and news broke that the economy grew at a better-than-expected pace in the June quarter.
At 5pm, the kiwi was at US40.46c from US40.27c at yesterday's close.
"Kiwi performed pretty well really, it is finishing the week on quite a strong note," a local currency dealer said.
"It was end of year for a few local banks so there were quite a few flows and we also had that GDP figure."
Data released by Statistics New Zealand this morning showed the local economy surged ahead by 2 percent for the June quarter surpassing expectations, largely because of rising exports and internal demand.
Gross domestic product (GDP) - the broadest measure of a country's economic activity - had been expected to rise by 1.4 percent for the quarter.
The strong rate of growth in the quarter - contributing to a 2.3 per cent increase for the year to June - followed a rise in GDP of just 0.3 percent for the three months to March.
The local unit had been languishing below US40c ahead of this morning's data, but rose to US40.15c minutes after the release.
Dealers said the kiwi hadn't rallied as much on the data as it would have in previous years, however.
"The old currency takes a long time to react. It is not instantaneous like it used to be on data like that now."
The kiwi has been hammered down by around 9 percent in the aftermath of the terrorist attacks in the US as investors scramble for safe havens. However, the buoyant growth data should help underpin the struggling currency in the longer term, dealers said.
The local unit was expected to trade between US40.20c and US40.60c overnight.
Its Australian counterpart ended the local session at US49.14c (US48.83c at yesterday's close).
On the crosses at 5pm the kiwi buying A82.33 (82.45c at yesterday's close), 48.25 yen (47.65), 27.51 pence (27.31), 0.8657 marks (0.8551), 0.6540 Swiss francs (0.6461) and 0.4426 euros (0.4382).
The trade-weighted index was at 48.05 (47.82), 90-day bill yields were at 5.28 per cent (5.27) and the monetary conditions index was at minus 1033 (minus 1062).
Among the bonds, the March 2002s were at 5.09 per cent (5.10), the April 2004s were at 5.44 per cent (5.45), the November 2006s were at 6.00 per cent (6.04), and the November 2011s were at 6.45 per cent (6.50).
- NZPA
<i>Currency:</i> Kiwi ends on strong note following positive GDP figure
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