KEY POINTS:
The New Zealand dollar continued to trend up today but in a market that remains jumpy and volatile.
The kiwi closed on US78.85c against US78.08c at 5pm yesterday.
ANZ bank today said the NZ dollar had benefitted from a rise on US equity markets overnight and strong markets in Asia.
US share indexes rose after executives at MBIA Inc, a major bond insurer, offered reassurances about the company's outlook.
The US dollar hovered near a record low against the euro before crucial US economic data due tomorrow NZ time.
Traders are looking to US non-farm payrolls and a reading of factory activity to help them determine whether to keep dumping the dollar, which tumbled to its weakest in nearly three years against the yen last month.
The US currency has been stung by two hefty interest rate cuts by the Federal Reserve in less than 10 days, along with ongoing concerns about credit problems and signs of serious economic weakness.
"Basically, the payrolls figures must be very strong to spur any significant dollar buying," said Hideaki Inoue, a forex manager at Mitsubishi UFJ Trust and Banking.
Overall, stock market movements have firmed following a frantic sell-off last month spurred by fears of a US recession, which prompted an emergency, 75 basis-point rate cut by the Fed last week.
MBIA Inc, the world's biggest bond insurer, on Thursday said it suffered US$3.5 billion in write downs linked to US subprime mortgages, while posting a record quarterly loss.
At the same time, it assured investors that it was working towards bolstering its capital and retaining its current credit rating. Bank of New Zealand currency strategist Danica Hampton said the overnight improvement in US share prices had increased investors' appetite for carry trade currencies such as the kiwi against the yen.
Against the Australian dollar, the kiwi edged up to A87.90c from A87.85c yesterday.
The trade weighted index rose to 72.15 from 71.59.
CURRENCY RATES AT 5PM
Reuters currency rates:
5pm today 5pm yesterday
NZ dlr/US dlr US78.85c US78.08
NZ dlr/Aust dlr A87.90c A87.85c
NZ dlr/euro 0.5303 0.5260
NZ dlr/yen 83.87 83.01
NZ dlr/stg 39.61p 39.34p
NZ TWI 72.15 71.59
Australian dollar US89.66c US88.85c
Euro/US dollar 1.4871 1.4838
US dollar/yen 106.33 106.37
- NZPA