The New Zealand dollar was little changed today after falling away from a 27-month high against the greenback on Thursday night as the Australian dollar retreated from a flirtation with parity with the US dollar.
By 5pm today the NZ dollar was buying US75.70c, up slightly from US75.60c at 8am
and down US76.14c at 5pm yesterday. It topped US76.40c on Thursday night.
The currency market story continues to be one of US dollar weakness. The US dollar slumped to a 2010 low against a basket of currencies after Singapore said on Thursday it would guide its currency higher at a slightly faster pace in a bid to contain inflation.
The Australian dollar experienced a bout of profit-taking after rising to US98.90c on Thursday night. It was US99.12c at 5pm from US99.55c at the same time yesterday.
Investors have been dumping the US dollar on expectations the Federal Reserve will start printing money with further quantitative easing as soon as next month. They are currently awaiting a speech by Fed chairman Ben Bernanke.
The ANZ bank said disappointing New Zealand retail sales figures released yesterday left the NZ dollar without underlying fundamental support.
While it managed to briefly move higher the cracks appeared overnight ensuring a move back below US76c, the bank said.
Increased risk aversion was also evident, with US bank shares hit as investors grew increasingly concerned about the effect on earnings of a nationwide probe into the mortgage industry's foreclosure practices.
The NZ dollar was down to 0.5392 euro at 5pm from 0.5411 at the same time yesterday. It dropped to 61.62 yen from 61.86 and slipped to A76.34c from A76.43c.
The trade weighted index was 66.90 at 5pm from 67.17 yesterday.
- NZPA
