JASON KRUPP Last updated 08:37 27/01/2012
The New Zealand dollar rose against the greenback, with the Federal Reserve's commitment yesterday to keep interest rates at near zero until the end of 2014 continuing to weigh on the US currency.
The kiwi recently traded at US$81.88 cents, up from US$81.72c at 5pm yesterday, and rose to 72.23 on the trade weighted index of major trading partners' currencies, from 72.12 previously.
Yesterday's announcement increased the interest rate differential between the US and New Zealand, with the Reserve Bank expected to start raising the Official Cash Rate towards the end of this year or possibly early 2013, more than a year ahead of the Fed.
That boosted demand for the kiwi, as currency traders took it as a sign that US dollar was set for a period of protracted weakness.
Still, the currency slipped from an intra-session high of US82.34c as investors stopped to catch their breath following yesterday's sharp rally. A sudden drop in US new home sales for December also giving markets reason to pause.
On Wall Street, the Standard & Poor's 500 Index dipped into the red in afternoon trade, and recently traded 0.5 per cent down at 1319.57. Meanwhile, Europe's Stoxx 600 Index closed 1.1 per cent higher at 257.86.
"For today, we wouldn't be surprised to see profit-taking knock the New Zealand dollar and US dollar a shade lower given the strong gains over the week," said Mike Jones, a market strategist at Bank of New Zealand.
"However, we expect positive momentum and negative US dollar sentiment will see the NZD/USD test October's US82.45c high before too much longer."
On the crosses, the kiwi recently traded at 76.84 Australian cents, down from A76.94c yesterday, and it rose to 63.24 yen from 63.12 yen. It was little changed at 62.19 euro cents from 62.15 euro cents previously, and rose to 52.03 pence from 51.84 pence.
The currency may trade between a range of US81.95c and US82.85c, according to an ANZ report.
http://www.stuff.co.nz/business/market-data/currencies/6322700/NZ-dollar... KRUPP Last updated 08:37 27/01/2012
The New Zealand dollar rose against the greenback, with the Federal Reserve's commitment yesterday to keep interest rates at near zero until the end of 2014 continuing to weigh on the US currency.
The kiwi recently traded at US$81.88 cents, up from US$81.72c at 5pm yesterday, and rose to 72.23 on the trade weighted index of major trading partners' currencies, from 72.12 previously.
Yesterday's announcement increased the interest rate differential between the US and New Zealand, with the Reserve Bank expected to start raising the Official Cash Rate towards the end of this year or possibly early 2013, more than a year ahead of the Fed.
That boosted demand for the kiwi, as currency traders took it as a sign that US dollar was set for a period of protracted weakness.
Still, the currency slipped from an intra-session high of US82.34c as investors stopped to catch their breath following yesterday's sharp rally. A sudden drop in US new home sales for December also giving markets reason to pause.
On Wall Street, the Standard & Poor's 500 Index dipped into the red in afternoon trade, and recently traded 0.5 per cent down at 1319.57. Meanwhile, Europe's Stoxx 600 Index closed 1.1 per cent higher at 257.86.
"For today, we wouldn't be surprised to see profit-taking knock the New Zealand dollar and US dollar a shade lower given the strong gains over the week," said Mike Jones, a market strategist at Bank of New Zealand.
"However, we expect positive momentum and negative US dollar sentiment will see the NZD/USD test October's US82.45c high before too much longer."
On the crosses, the kiwi recently traded at 76.84 Australian cents, down from A76.94c yesterday, and it rose to 63.24 yen from 63.12 yen. It was little changed at 62.19 euro cents from 62.15 euro cents previously, and rose to 52.03 pence from 51.84 pence.
The currency may trade between a range of US81.95c and US82.85c, according to an ANZ report.
http://www.stuff.co.nz/business/market-data/currencies/6322700/NZ-dollar-extends-gains
