The New Zealand dollar recouped earlier losses against the US dollar ahead of an expected US Federal Reserve rate cut to near-zero.
By 5pm, the kiwi was at US55.86c from US55.35c late yesterday afternoon. Against the Australian dollar, the kiwi gained to A83.50c from A82.60c.
The kiwi was
a touch weaker against the euro and sterling, but gained slightly against the yen.
One dealer said the currency was retaining a fairly firm tone, and could head as high as US56.20/30c overnight.
The US dollar plunged to a two-month low against the euro on increasing expectations that the Fed will cut interest rates again tomorrow, this time by at least half a percentage point to 0.50 per cent.
The Fed may also lay out emergency plans to ward off a recession.
Westpac senior currency strategist Imre Speizer said the US dollar had come under some pressure since late last week, and was likely to be sold off further on bad news, which meant the near-term outlook for the kiwi was positive.
However, low commodity prices would remain a headwind for the currency, despite data from other aspects of the economy expected to be relatively benign in the next week.
Currency rates:
NZ dlr/US dlr US55.86c US55.35c
NZ dlr/Aust dlr
A83.50c A82.60c
NZ dlr/euro 0.4073 0.4107
NZ dlr/yen 50.57 50.30
NZ dlr/stg 36.50p 36.82p
NZ TWI 54.89 54.72
Aust dlr/US dlr US66.92 US66.93
Euro/US dlr 1.3714 1.3470
US dlr/yen 90.52 90.94
- NZPA
