5.31pm
The kiwi dollar again scaled US70c today as the US dollar suffered another bout of weakness.
The kiwi closed on US70.07c from US69.75c at 5pm yesterday, having ranged between US69.83c and US70.29c overnight. The kiwi had a stint over US70c in late October and also in February.
The US dollar fell against most currencies after a government report showed increased capital flows into the United States did little to soothe worries over the country's large external imbalances.
Clyde Wardle, currency strategist at HSBC in New York, said while the data was strong, it did nothing to fundamentally change the view in the market that US external imbalances were getting worse and that the dollar would decline as a result.
BNZ currency strategist Sue Trinh said most of the kiwi's strength was due to poor sentiment against the greenback.
Ms Trinh said the data showed the US was not having any trouble in funding its external deficit as of September, but the fact that the demand continued to come mainly from US Treasuries, corporate bonds and stocks, and agency bonds highlighted the risks for the greenback and US interest rates going forward.
Meanwhile, the aussie also gained against the US dollar, on the back of some interest rate-driven support. The Governor of the Reserve Bank of Australia, Ian Macfarlane, said last night Australia's interest rates were more likely to rise than fall over the next 12 to 18 months.
The aussie closed at US77.31c, up from US76.96c at 5pm last night.
The greenback was at 105.42 yen (105.44 yen) and the euro was at US$1.2960 (US$1.2930).
On the crosses the kiwi was buying A90.55c (A90.64c) 0.5403 euro (0.5395 euro) 37.71 British pence (37.77) 73.84 yen (73.54 yen) and 0.8233 Swiss francs (0.8236).
The trade-weighted index was at 68.48 (68.30) and the monetary conditions index was at plus 884 (872).
On the money market, 90-day bank bill yields were unchanged on 6.75 per cent.
February 2006 bond yields were also unchanged on 6.24 per cent, July 2009s were at 6.00 per cent (6.01) and April 2013s were unchanged on 6.08 per cent.
- NZPA
<i>Currency:</i> Kiwi scales US70c again
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