Kiwi dollar surges to 7- week high

The New Zealand dollar rose to a seven-week high against a broadly weakening greenback.

The move came as strong corporate earnings in the United States prompted investors to plunge back into high-yielding currencies and other risky assets.

At 8am the NZ dollar was buying US65.68c, down slightly from the high around US65.75c reached an hour earlier, having climbed from US64.80c at 5pm yesterday.

Reports of a last-minute rescue for ailing US lender CIT Group boosted optimism on the currency market.

"It's a risk-preference story. With equities firmer and breaking some semi-interesting levels, the (US) dollar has come under pressure as a result," said John McCarthy, director of foreign exchange at ING Capital Markets in New York.

The NZ dollar also reached three week highs against the European and Japanese currencies.

By the local open the kiwi was buying 0.4616 euros, having peaked above 0.4620, from 0.4575 at 5pm.

The NZ dollar was also at 61.89 yen at 8am, after rising above 62 yen, from 61.35 at yesterday's local close.

The trade weighted index rose to 61.37 at 8am from 60.87 at 5pm, while against the Australian dollar, the kiwi was little changed at A80.46c from A80.30c.

- NZPA