The New Zealand dollar made up some ground today after missing a ride on the sliding United States dollar overnight.
At 5pm the kiwi traded at US56.11c, not far from yesterday's close of US56.12c but a long way from its level at the end of last week of US56.50c.
The aussie was at US61.51c from US61.29c yesterday.
ANZ Investment Bank chief foreign exchange dealer Murray Hindley said the kiwi had slipped into a lower range this week.
"The kiwi was trading at its lows this morning at US55.87c, and drifted back to close above the figure (US56c).
"The retail sales data was a bit stronger than market expectations, but that's been about it," Mr Hindley said.
Retail sales rose 1.1 per cent in January, Statistics New Zealand said - much stronger than the 0.4 per cent increase forecast by analysts or December's 0.5 per cent rise.
The kiwi was likely to encounter resistance at US56.20c, and it should trade above US55.80c overnight, he said.
Overnight, the US dollar fell to fresh four-year lows against the euro and to near seven-month lows against the Japanese yen, as the growing threat of war on Iraq kept risk aversion at high levels.
However, the greenback hovered above recent lows in Asia today, thanks largely to speculation that Japanese authorities may step up their campaign to stem the yen's rise.
"Possibly we are now seeing the final round of US dollar selling ahead of a conclusion and a coincident US dollar correction," Westpac currency strategist Johnathan Bayley said.
The US dollar continued to lurk below 117 yen, and in Wellington at 5pm was buying just 116.84 yen (116.88 yen last night).
The euro also firmed against the US unit to buy $US1.1055 at 5pm ($US1.1023) - close to a four-year high of $US1.1069 hit in New York on Friday.
On the crosses at 5pm the kiwi was softer against all its major trading partners, buying A91.23c (A91.48c), 0.5075 euro (0.5092), 0.7441 Swiss francs (0.7482), 65.56 yen (65.59) and 35.05 pence (35.12).
On the money market, 90-day bills were at 5.81 per cent (5.80), the monetary conditions index was at plus 204 (plus 210), and the trade-weighted index was at 60.90 (61.99).
The April 2004 government bonds were at 5.32 per cent (5.35), the November 2006s were at 5.26 per cent (5.28) and the November 2011s were at 5.64 per cent (5.65).
- NZPA
<i>Currency:</i> NZ dollar returns to levels above US56c
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