The New Zealand dollar had a volatile session today as it followed its Australian counterpart.
"It's been yo-yoing around," one dealer said today.
By 5pm the kiwi was at US58.41c, down slightly from yesterday's local close of US58.55c. The aussie was at US65.56c, also weaker than its 5pm level of US65.70c yesterday.
The dealer said the kiwi had traded between a low of US58.12c and US58.46c today, with moderate volume in the market.
"It's mainly been following the Australian dollar around today. We had some local supply this morning that weighed on the market, kiwi/yen of all things. It was local corporate stuff going through, a bit of selling (of kiwi).
"Also a weaker Australian dollar today earlier on," he said.
Australian-based Toll Holdings' announcement yesterday it had purchased a 6.1 per cent stake in Tranz Rail ahead of RailAmerica's 75c per share offer had little foreign exchange implication, he said.
"In dollar value that's very small - only $NZ10 million or $NZ12 million, it just gets washed through. (The bid)'s definitely in the background ... someone is potentially going to buy it, but then it's the question of whether they fund it locally or decide to pay cash for it ..."
The threat of intervention by the Japanese authorities kept the US dollar steady in Tokyo today, well above its levels yesterday despite speculation that Washington was tacitly seeking a weaker greenback.
In Wellington at 5pm the euro eased to $US1.1664 ($US1.1696), and the US dollar was buying 117.08 yen (115.25 yen).
On the crosses at 5pm the kiwi was at A89.07c (A89.12c at 5pm yesterday), 68.37 yen (67.48 yen), 35.78 pence (35.93), 0.7573 Swiss francs (0.7584), and 0.5010 euro (0.5007).
The monetary conditions index was at plus 239 (237), the trade-weighted index was at 61.91 (61.81) and 90-day bank bill yields were at 5.34 per cent (5.36).
The February 2005 yields were at 4.98 per cent (4.96), the November 2006s were at 5.13 per cent (5.11), and the November 2011s were at 5.46 per cent (5.41).
- NZPA
<i>Currency:</i> Kiwi follows Aussie in volatile session
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