Dollar's upward climb 'limited'

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Currency analysts are not expecting the New Zealand dollar to climb much higher than the six-month peak - close to US74c - it reached against the greenback late on Tuesday night.

After hitting its high, it fell back to sit at US72.92c yesterday.

BNZ markets strategist Mike Jones said a general improvement in global business sentiment had helped push the kiwi to its six-month high. "There's been a collective sigh of relief in global markets that the global economy's not experiencing a double-dip recession."

The kiwi took yesterday's business confidence survey in its stride, Jones said. "I think a bit of a fall in business confidence was expected."

Most analysts were expecting a small rate rise from the Reserve Bank this morning, but of more interest would be any clues the bank gave about future increases, which could further feed investor interest and boost the kiwi, Jones said.

Westpac senior markets strategist Imre Speizer said the kiwi may reach US74.40c next week. It would then experience a "much longer slide back" to under US70c over three months.