Dollar hovers below six month US high

File Photo.

The New Zealand dollar eased a touch from its earlier six-month high against the greenback around US73.50c, in quiet trading after an upbeat session overnight.

By 5pm, the kiwi was at US73.41c, compared with US72.74c late yesterday afternoon.

Against the Australian dollar, the kiwi was a touch firmer at A81.40c from A81.28c yesterday afternoon.

The kiwi was also up against the euro (0.5648 from 0.5628 yesterday), yen (63.84 from 63.70) and sterling (47.36p from 47.10p).

As a result of the currency holding onto much of its overnight gains across the board, the trade weighted index rose to 68.39 from 68.13.

The kiwi gained from a generally positive mood offshore, which prompted investors to cut positions in safe haven currencies such as the greenback.

Short-term speculative accounts moving to cover short positions in the NZ dollar against the US dollar also helped push the kiwi above US73c last night.

Data on home sales in the United States had boosted investor sentiment, with new home sales rising nearly 24 per cent in June from a month earlier, although it was still the second-weakest month on record.

Markets were also still taking heart from stress test results for 91 European banks, with regulators finding only a handful of banks failed the test, although scepticism of the outcome persisted.

Today, the euro neared a two-month high of US$1.3000 ahead of results from Deutsche Bank, as investors wait to see how exposed the German bank is to European sovereign debt. A positive outcome could shore up confidence in the region's banks and spark euro buying.

- NZPA