Kiwi dollar hits US65c

Increasing risk appetite saw the New Zealand dollar increase to US65c overnight, as world equity markets reported solid gains.

The New Zealand dollar was trading at US64.96c earlier this morning, up from US64.07c yesterday.

The kiwi gained against all other currencies overnight as well, reaching A80.94c, from A80.65 yesterday, 0.4604 euro, from 0.4578, 61.28 yen from 59.89 and 39.57 pence, from 39.25p yesterday.

BNZ strategist Danica Hampton said the 0.6525/0.6550 window of resistance looked key at open this morning.

"We wonder if businesses might try to wriggle price increases through, here and there, in a desperate bid to restore profitability (especially for those dealing with exchange rate costs)."

ANZ senior market economist Khoon Goh likewise noted crumbling resistance levels and the "waves of buyers".

"Risk is back, and with a vengeance. If investors can get through this earnings season with renewed confidence, then risk appetites can only improve and risk assets will continue to be sought after," he said. The trade weighted index was 61.09, up from 60.49 yesterday.

The US dollar fell to a one-month low against major currencies on Wednesday, as better-than-expected results from Intel and Goldman Sachs boosted confidence about corporate earnings and the outlook for the economy.

Elsewhere, data Wednesday showed China's currency reserves surged to US$2.13 trillion last month. The yuan hit a two-week closing high at 6.8316 per dollar on Wednesday, its highest close since July 2.

NZPA