The New Zealand dollar held onto its gains today but was unable to make any further headway against the US dollar, hit by worse than expected provisional third quarter GDP figures on Friday.
The kiwi took a knock last Thursday after the Reserve Bank left the Official Cash Rate unchanged, but perked up on Friday as September's trade deficit came in lower than predicted.
"While momentum and other model-based accounts were noted sellers of NZD/USD, in the current yield-seeking environment it is difficult to see the NZD/USD substantially below US65.00 until the market rules out further RBNZ hikes," the Bank of New Zealand said.
The Bank of NZ expected the kiwi to stick to a familiar range bounded by US65c and US67c over the coming week.
It climbed strongly against the US dollar in the early hours of Saturday morning (NZT) from a low point of around US65.30c and around 5.20pm today was buying US66.23c. At 5pm on Friday it had been worth US65.92c.
The kiwi was weaker against the Australian dollar, buying A86.01c from A86.25c at 5pm on Friday.
The New Zealand dollar was also buying 0.5204 euro from 0.5190 at 5pm on Friday, and 77.73 yen from 78.12. The trade weighted index was at 66.20 from 66.15.
Offshore developments are expected to drive the kiwi this week, with little on the domestic calendar aside from the National Bank's business outlook early tomorrow, and the ANZ Commodity Price Index on Friday.
Statistics New Zealand (SNZ) said today new dwelling unit consents rose a seasonal adjusted 6.1 percent in September from a month earlier, part of a rising trend.
Reuters currency rates:
5.20pm today 5pm Friday
NZ dlr/US dlr US66.23c US65.92c
NZ dlr/Aust dlr A86.01c A86.25c
NZ dlr/euro 0.5204 0.5190
NZ dlr/yen 77.73 78.12
NZ dlr/stg 34.91p 34.87p
NZ TWI 66.20 66.15
Australian dollar US77.02c US76.45c
Euro/US dollar 1.2728 1.2703
US dollar/yen 117.38 118.48
- NZPA
<i>Currency:</i> Kiwi rebounds but pinned within familiar range
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