Dollar powers to 13-month high

The New Zealand dollar powered to a 13-month high against the greenback, briefly topping US71.50c, as global risk appetites improved.

By 8am today the kiwi was buying US71.43c, having been around that level for about four hours. It had climbed from US70.57c at 5pm yesterday.

The US dollar's fall against a basket of currencies came amid optimism about a global economic recovery, which eroded demand for the greenback as a safe haven.

Shares on Wall Street rallied as increased industrial production and a pickup in mergers and acquisitions reinforced hopes the economy was gaining speed.

Improving risk appetite pushed up higher-yielding currencies such as the Australian and NZ dollars.

The NZ dollar was stronger against a range of currencies, reaching a 12-1/2-year high against the British pound at 43.35p.

BNZ Capital senior strategist Danica Hampton said the pound was tending to lag gains seen in other currencies.

Much of its recent weakness was a hangover from recent comments by Bank of England Governor Mervyn King, while British unemployment data out last night "wasn't particularly inspiring".

The NZ dollar was up to 0.4850 euro at 8am from 0.4807 at 5pm, and lifted to 64.88 yen from 64.24.

Against the Australian dollar, the kiwi rose to A81.67c at the local open from A81.46c, while the trade weighted index lifted to 64.85 at 8am from 64.31 at 5pm.

- NZPA