The New Zealand dollar traded quietly yesterday, inching higher on the strength of the aussie dollar.
The kiwi moved within a fairly tight range and closed close on its session high at US43.75c, compared with US43.56c Tuesday. The aussie closed yesterday at US53.09 (US52.88c Tuesday).
"The aussie's rallied about 35 points from its open," ANZ Investment Bank senior forex manager Richard Marshall said.
He said stop-loss buyers were the reason for the rise.
"The market over the last few days has got very short, anticipating a move possible down towards US52.20c, but it held well and now the whole market's short."
Looking at the order board, Mr Marshall said the bigger picture was still unclear but he believed the kiwi's recent failure to push on beyond US44c was a temporary fall, although he personally did not believe it had the potential to go much further.
"I don't see that much more upside in the kiwi personally, and the aussie's possibly got another 30 points in it, I'd say, whereas the kiwi's probably only got another 20."
Little else was influencing the currency at the moment, although positive retail sales yesterday had helped push the dollar higher, Mr Marshall said. The market was also anticipating another rise in interest rates next week.
Overnight he picked the kiwi to trade between US43.60/90.
On the crosses at 5pm, the kiwi traded at A82.40c (A82.39c at Tuesday's close), 0.4965 euro (0.4984), 57.00 yen (57.41), 30.34 pence (30.44) and 0.7281 Swiss francs (0.7306).
The aussie was at $NZ1.2136 ($NZ1.2139).
The monetary conditions index was at minus 542 (minus 539), the trade weighted index was at 52.63 (52.67), and 90-day bank bills were at 5.64 per cent (5.63).
On the debt market, the April 2004 bonds were at 6.33 per cent (6.34), the November 2006s were at 6.77 per cent (6.79) and the November 2011s at 6.90 per cent (6.93).
- NZPA
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