The New Zealand dollar received a boost from its Australian counterpart today to close at a new 40-month high.
At 5pm, the kiwi was trading at US53.47c compared with US52.99c at yesterday's close. Last night it slipped to US52.72c in Europe but spiked in New York to US53.30c as scepticism mounted in the United States about a government economic stimulus package.
The aussie rose to a 2-1/2-year high today of US57.78c (US57.41c last night).
"It was pretty quiet until the aussie broke through US57.70c, and on the back of that we saw the kiwi break through US53.50c," one local dealer said.
"Generally (the kiwi)'s just drifted back a little, but it remains pretty well bid."
The aussie burst up through its previous resistance level this afternoon and appeared set to continue climbing, the dealer said.
The kiwi's range today was US53.26/50c, and it was likely to trade between US53.25/65c overnight.
"Not a great deal (of volume). The market's getting back into the swing but it seems a lot of the moves are happening overnight so nothing too much on the day," he said.
The rises in both the kiwi and aussie were sparked by a further decline in the US dollar, which fell to three-year lows against the euro in New York.
The greenback steadied during the day but traders said they expected mounting geopolitical worries to keep pressure on the US currency.
However, any falls against the yen were likely to be limited, as a slip under 119 yen could raise fears of Japanese intervention, dealers said.
In Wellington at 5pm, the euro was buying $US1.0515 ($US1.0428), while the US dollar was at 118.97 yen (118.88 yen).
Against its major trading partners the kiwi was at A92.31c (A92.31c), 0.5086 euro (0.5074), 63.61 yen (63.37), 33.12 pence (33.02), and 0.7407 Swiss francs (0.7394).
The Australian dollar was at $NZ1.0813 ($NZ1.0833).
The trade-weighted index was at 59.47 (59.25), 90-day bank bills were at 5.91 per cent (5.93), and the monetary conditions index was at plus 96 (plus 78).
On the debt market, the April 2004s were at 5.74 per cent (5.75), the November 2006s were at 5.90 per cent (5.86), the November 2011s were at 6.14 per cent (6.13), and the April 2013s were at 6.17 per cent (6.19).
- NZPA
<i>Currency:</i> Kiwi hits fresh 40-month highs
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