NZ dollar rises ahead of debt meeting

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The New Zealand dollar rose against the greenback ahead of a key meeting in Europe where officials are expected to put the final touches on a Greek debt restructuring deal, although the currency's movements were locked in a tight range.

Euro-zone sentiment was high ahead of the debt talks with markets hoping the rescue package will be enough to stop the Greek debt woes spreading to other heavily indebted countries including Portugal, Ireland, Italy and Spain.

That saw European stocks and the euro gain, with the kiwi dollar tracking upwards in step with it. Europe's Stoxx 600 rose 1.3 per cent to 267.73, and the euro recently traded at $US1.4225, up from US$1.4173 yesterday.

"There's been a positive build up ahead of the European meeting," said Alex Sinton, a senior dealer at ANZ New Zealand.

"Should officials come with a package as expected, that should boost the euro and drag the kiwi to the top of the recent range."

The kiwi recently traded at 85.61 U.S. cents, up from 85.50 cents yesterday, and fell to 73.72 on the trade-weighted index of major trading partners’ currencies from 73.76.

It rose to 79.69 Australian cents from 79.61 cents yesterday, and fell to 67.41 yen from 67.47 yen. It dropped to 60.14 euro cents from 61.29 cents yesterday, and declined to 52.97 pence from 53.18 pence previously.

A slide in the greenback stoked demand for currencies not pegged to the U.S. dollar, with the market unable to sustain yesterday's corporate earnings and debt deal momentum. The Dollar Index, a measure of the greenback against six major currencies, fell to 74.78, down from 75.05 previously.

Wall Street closed mixed, with the Standard & Poor's 500 slipping 0.07 per cent to 1325.84.

Locally, traders will be watching for the release of June travel and migration as well as credit card data today for further signs that the New Zealand economy is clawing its way to recovery.

The data is however second tier according to Sinton, and unlikely to move the currency much.

Sinton said the kiwi may trade between a range of 85 U.S. cents and 86 cents, with the bias towards the upside although topside resistance is expected to hold.