NZPA - The New Zealand dollar held overnight gains yesterday in quiet trading within a narrow range.
It closed at US42.25c having picked up from Thursday's two week low of US41.96c and after trading in a US42.15-42.26c range.
Westpac chief dealer Basil Payn said the kiwi's direction would be set by the euro and the Australian dollar where the trend was particularly confused.
The aussie closed at US51.50c against its US51.41c close Thursday.
Mr Payn said that the kiwi had good support at US41.80-42.20c and if that level held early next week then there would be another test of US43c.
A sharp rise in the Federal Reserve Bank of Philadelphia's index of business conditions - to 14.7 in January from last month's -12.6 - gave the Australasian growth currencies a boost.
"The strong Philly Fed index gave growth bulls a bit of a fill up and this flowed through to better bid Australasian currencies," BNZ forex strategist Stuart Ritson said.
That strength could be shortlived, however.
"What is clear at this point is the fluid nature of the global growth outlook. It seems that expectations are constantly changing and this is translating into choppy intra range trade."
Much stronger than expected retail sales in November published yesterday is likely to confirm the Reserve Bank's belief that it has no need to change interest rates when it formally reviews them on Wednesday.
On the crosses the kiwi was buying A82.07c (A81.60c at yesterday's close), 56.12 yen (55.36), 29.41 pence (29.22), 0.7040 Swiss francs (0.6962) and 0.4798 euro (0.4750). The Australian dollar was buying $NZ1.2181 ($NZ1.2255).
The Trade Weighted Index was at 51.32 (50.86), 90-day bank bills were at 4.87 per cent (4.86) and the monetary conditions index was at minus 747 (minus 792).
On the debt market, the March 2002 bonds were at 4.75 per cent (4.73), the April 2004s were at 5.64 per cent (5.59), the November 2006s were at 6.19 per cent (6.14), and the November 2011s were at 6.49 per cent (6.44).
- NZPA
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