The New Zealand dollar regained some ground today after losses overnight in reaction to a US dollar rally.
Last night United States Federal Reserve chairman Alan Greenspan's optimistic comments about the US economy pushed the greenback to its highest level in at least two months against major European currencies in New York.
This, along with a surprisingly low June quarter Consumers Price Index figure (CPI) here in New Zealand exerted downward pressure on the kiwi.
However, the greenback settled back somewhat today and by 5pm the kiwi was buying US58.17c, down slightly from last night's US58.37c but well up on today's downside of US57.87c and just short of its high of US58.18c.
Meanwhile the aussie was at US65.15c (US65.54c yesterday).
Tonight, the dealer expected the kiwi to trade in a US57.70c to US58.40c range.
Trading tonight would again be affected by news from the US the dealer said, with markets there reacting further to Greenspan's comments and US CPI, business inventories and capacity utilisation figures also due.
"I expect that for the first five hours we'll probably see very little going on, but New York will probably be the decider on the night," the dealer said.
By 5pm in Wellington the euro had eased to $1.1160 from US$1.1264 yesterday, while the US dollar gained ground to 118.33 yen (117.66).
The kiwi gained against most key crosses by 5pm to buy A89.29c (A89.05c yesterday), 0.5212 euro (0.5183), 68.83 yen (68.68), 36.56 pence (36.24), and 0.8074 Swiss francs (0.8037).
The Australian dollar eased to $1.1199 ($1.1229 yesterday).
The monetary conditions index was at plus 265 (257), the trade-weighted index was at 62.55 (62.41), and 90-day bank bill yields were at 5.10 per cent (5.12).
On the bond market, the February 2005 yields were at 4.91 per cent (4.80), November 2006s were at 5.11 per cent (4.96), and the November 2011s widened to 5.59 per cent (5.36).
- NZPA
<i>Currency:</i> Kiwi recovers slightly from Greenback rally
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