Currency: Kiwi climbs upwards after US Fed rate review

5.50pm

After a flurry of activity this morning, the New Zealand dollar settled down to trade in the lower US63c range, brokers said today.

At 5pm, the kiwi was at US63.32c (from US62.56c at 5pm yesterday), having traded between US63.17c and US63.49c.

The Australian dollar was at US73.10c (US72.33c).

ANZ Bank chief foreign exchange dealer Murray Hindley said that, as expected, the US Federal Reserve's benchmark rate review had shunted the kiwi out of the US62c range.

At 6.15am NZT, the Federal Reserve held its rate at 1 per cent and said any hike would take place at a "measured" pace. It cited low inflation and "slack" resource use as reasons.

The announcement caused the kiwi to spike from US62.80c into the US63c range.

"It struggled a bit at US63.50c and has backed off from there and went down to US63.30c," Mr Hindley told NZPA today, noting the kiwi could still push higher.

Later in the morning, the Reserve Bank of Australia (RBA) held its benchmark interest rate at 5.25 per cent in a move to cool a boom in household debt without causing a fall in property prices.

Mr Hindley said the RBA's stance had little affect on the kiwi.

Meanwhile, the greenback was buying 109.45 yen (110.26), while the euro was buying US$1.2115 (US$1.1960).

On the crosses, the kiwi was fetching A86.62c (A86.47c), 35.24 British pence (35.26), 69.30 yen (68.97), 0.8104 Swiss francs (0.8127), and 0.5227 euro (5325).

The trade-weighted index was at 64.08 (63.78), while the monetary conditions index was at plus 458 (437).

On the debt market, 90-day bank bill yields were at 5.82 per cent (5.83).

The February 2006 yields were at 5.73 per cent (5.74), July 2009s were unchanged at 6.02 per cent and April 2013s were at 6.19 per cent (6.18).

- NZPA