The New Zealand dollar was trapped in the doldrums yesterday after another spirited performance overnight.
By 5pm the kiwi was at US48.32c, barely changed from Tuesday's close of US48.35c, while the aussie eased to US55.30c (US55.30c).
After testing the key resistance level US48.53 level, the kiwi followed a sluggish Australian dollar down overnight and ap peared to have lost that momentum yesterday.
Inflation figures from Australia was right on expectations, leaving currency markets unshaken.
"I can't think of a reason why we should racing off in any direction at the moment," said Sean Brown, a dealer with Deutsche Bank.
He forecast an overnight range of US48.20/40c .
But BNZ currency strategist suggested in his morning commentary that an overhang of long positions was probably just delaying an eventual breakthrough.
"The US48.50/55c level on the top side has again held, suggesting still decent New Zealand dollar supply around this level." Higher levels beckoned the kiwi, with any break through US48.50c opening the way for a move to US49.90c, he said.
With a dearth of data from the United States until later in the week, currency traders took their direction from Wall St where stocks stuck in negative territory kept the US dollar pinned lower against the euro and steady against the yen.
In Wellington at 5pm yesterday the greenback eased slightly to 125.05 yen from 125.18 yen on Tuesday, while the euro was higher at US97.69c (US97.33c).
On the local crosses the kiwi was easier against all its major trading partners except Australia where it was buying A87.39c (A87.06c at yesterday's close). Other crosses were 0.4947 euro (0.4967), 60.43 yen (60.53) 0.3129 pence (0.3133), and 0.7265 Swiss francs (0.7307).
The Australian dollar was down at $1.1444 ($1.1486).
The 90-day bill yield was at 5.89 per cent (5.91), the New Zealand dollar trade-weighted index was at 55.74 (55.79), and the monetary conditions index was at minus 231 (minus 226).
Yields rose slightly across the board on the debt market with April 2004 bonds at 5.78 per cent (5.79), the November 2006 yield was flat at 6.19 per cent, as was the November 2011 bond yield at 6.50 per cent.
- NZPA
<i>Currency:</i> Kiwi pauses for breath after spirited spikes
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