The kiwi rose against the US dollar amid concerns about Republican leaders reaching a budget deal with the Democrats before the end of the week. Picture / Kenny Rodger
The New Zealand dollar rose against the greenback on concern there are risks around Republican leaders looking to pass tax reform legislation and reach a budget deal with the Democrats before the end of the week to avoid a government shutdown.
The New Zealand dollar traded at US70.10c at 5pm
from US69.89c in New York on Friday. The trade-weighted index rose to 73.98 from 73.85.
The US dollar - which gained overnight Friday on optimism US tax reforms will be enacted, including slashing the corporate rate to 21 per cent from 35 per cent - came under some pressure today on lingering uncertainty as Republics and Democrats must agree on a spending plan for the rest of the fiscal year before the end of Friday.
Otherwise, many federal government functions are frozen, and many federal employees are furloughed although essential activities - such as national security - continue.
The Washington Post reported that while Congress averted a partial shutdown earlier this month with a two-week deal that left spending constant and punted on all other policy questions, it's unclear if either side has interest in another short-term deal.
The kiwi saw "a bit of a grind higher" in light trading, said ANZ senior economist Phil Borkin. "It may be the government shutdown possibility in the US looming in the background. That might be holding back sentiment about the tax package."
