The New Zealand dollar ran out of puff yesterday after racing away to multi-year highs against the greenback and the Australian dollar overnight.
The kiwi hit a near three-year high of US50.55c and a five year high of 90.05c on the Australian/New Zealand dollar cross in offshore trade, buoyed by selling of the Australian dollar in favour of the local unit.
But dealers said the break lacked the conviction to carry through to the local session, and by 5pm the kiwi had eased to US50.20c compared with US50.36c at yesterday's close.
The Australian unit was buying US56.05c (US56.32c), while the cross rate was A89.57c (A89.43c at Tuesday's 5pm close).
On the data front yesterday, Statistics New Zealand said the Food Price Index fell 0.4 per cent in November.
The result, well down on analysts' expectations of a 0.3 per cent rise, is further evidence of the subdued inflation environment.
The FPI makes up 17 per cent of the Consumer Price Index, the main indicator for inflation.
Dealers expected the kiwi to trade in a more staid US50.10c to US50.40c range overnight.
Against its other key trading partners at 5pm the kiwi was buying 0.4981 euro (0.4988), 61.94 yen (62.29), 31.97 pence (31.89), and 0.7342 Swiss francs (0.7351).
The Australian dollar was at $NZ1.1166 ($NZ1.1183).
The trade weighted index was at 57.17 (57.29), the monetary conditions index was at minus 100 (minus 89), and the 90-day bank bill yield was at 5.93 per cent (5.92).
On the bond market, the April 2004s were at 5.76 per cent (5.72), the November 2006s were flat at 6.01 per cent, the November 2011s were at 6.34 per cent (6.26), and the April 2013s were at 6.39 per cent (6.31).
- NZPA
<i>Currency:</i> Kiwi loses puff after tackling multi-year highs
AdvertisementAdvertise with NZME.