Last updated 08:34 03/02/2012
The New Zealand dollar held on to its gains against the greenback even as investors trimmed demand for higher yielding or riskier assets ahead of a US employment report and the latest round of Greek debt talks.
The kiwi recently traded at US$83.37 cents, little changed from US$82.34c at 5pm yesterday, with the overnight session characterised by choppy trading. On the trade-weighted index of major trading partners' currencies it rose to 73.09 from 72.07.
Global equity markets appeared to take a pause overnight after solid gains yesterday, with some apprehension building ahead of a key US job indicator.
A Bloomberg poll is expecting the measure to show employment grew by 145,000 after rising by 200,000 in December, with any shortfall likely to trigger fresh fears about the pace of recovery in the world's biggest economy.
On Wall Street, the Standard & Poor's 500 Index rose 0.04 per cent in afternoon trade on weaker earnings from drug maker Merck and clothing retailer Abercrombie & Fitch. In Europe, the Stoxx 600 Index closed 0.2 per cent higher at 260.11.
Meanwhile, Greece's protracted talks with its private sector debtors also trimmed buy-side activity, with both parties saying they hoped to hammer out deal over the weekend.
Investors appeared to be adopting a wait-and-see attitude, especially after recent reports claimed the country may need an additional 15 billion euro in the short term to pay its bills.
Still, a sangfroid attitude settled over the euro zone with yields on European bonds easing almost across the board. Notably, the risk premium of Portuguese 10-year paper dropped almost 50 basis points to 14.8 per cent.
That left growth-linked currencies essentially unchanged overnight, despite volatile trading, with the kiwi supported by bets that it still has more room to gain.
"Support again remains around the low US83c area as markets potentially look to the topside today," said Alex Sinton, a senior dealer at ANZ.
On the crosses, the kiwi recently traded at 77.83 Australian cents, up from A77.68c yesterday, and was little changed at 63.44 yen from 63.45 yen. It climbed to 63.41 euro cents from 63.23 euro cents previously, and gained to 52.75 pence from 52.57 pence at 5pm.
The kiwi may trade between a range of US83.10c and US83.80c, Sinton said.
- © Fairfax NZ News
http://www.stuff.co.nz/business/market-data/currencies/6359890/Kiwi-dollar-holds-on-to-gains
