The New Zealand dollar strengthened against the Australian currency yesterday, closing above the 75Ac mark for the first time in a week after the Reserve Bank of Australia decided to leave official interest rates unchanged.
The kiwi closed at 75.45Ac, up more than 1c from 74.37c at Tuesday's close.
However, it was still trading below 43USc. The kiwi closed at 42.77USc yesterday, from 42.67c on Tuesday.
The aussie closed at 56.69USc on the local currency market, from 57.45c at the end of local trading on Tuesday.
Unlike the aussie, the kiwi managed to maintain its gains after both currencies gained against the greenback, a currency dealer said.
Australia's central bank left the official cash rate unchanged but was still widely expected to raise rates in the coming month or two to keep inflation under wraps.
The bank last raised the cash rate on August 2 by 0.25 per cent to 6.25 per cent - the fifth move in less than a year.
The currency dealer said there were rumours in the market that the bank was buying Australian dollars, which had prompted a rush of trade.
He said dealers expected to see more interest in the aussie when British and US currency markets opened, because of the same rumours.
- NZPA
<i>Currency:</i> Kiwi up against crumbling $A
AdvertisementAdvertise with NZME.