KEY POINTS:
The New Zealand dollar hit a fresh post-float high today ahead of a busy week, despite further rumours of central bank intervention.
The kiwi hit a high of US76.84c during domestic trading, having plunged more than half a cent from US76.80c in New York on Friday.
The Bank of New Zealand said the Reserve Bank was rumoured to have sold New Zealand dollars aggressively late in the New York session, both directly and through an electronic broker. The central bank made no comment on the speculation.
By 5pm, the kiwi was at US76.64c from US76.39c in late Wellington trade on Friday.
The kiwi was little changed against the Aussie from its A90.28c Friday close, and rose to 94.93 yen from 94.71 on Friday.
"It's a major data week this week, and the key is going to be the New Zealand data but certainly we continue to see weaker US data," ANZ chief foreign exchange dealer Murray Hindley said.
Trade, consumer and business confidence, and building data will be of interest but overshadowed by first quarter current account and gross domestic product data towards the end of the week.
"We need to see if there's evidence of stronger data (as to) whether we have the opportunity to push higher," Mr Hindley said.
Investors have been keen to buy the kiwi as it retreats to around US75.30c, although sellers are poised if it returns to US76.80c. If sellers gave way, the kiwi was headed above US77c, he said.
Demand from Japan has been driving the NZ dollar higher, pushing it to nearly 20-year highs against the yen. The demand is possibly related to investment vehicles that invest summer bonuses paid out in Japan or upcoming New Zealand dollar denominated bond issues.
On its trade-weighted index, the kiwi was at 74.52. It peaked last week at 74.62 and closed on Friday at 74.48.
The yen edged up from a four-and-a-half low against the US dollar and all-time trough versus the euro today, but remained under pressure as investors kept selling the low-yielding currency in carry trades.
Investors kept risky positions like the carry trades in which low-yielding currencies such as the yen are borrowed to fund investment in higher-yielding currencies like the kiwi, brushing aside a 0.5 per cent dip in Tokyo's Nikkei share average and a sharp drop on Wall Street.
- NZPA