KEY POINTS:
The New Zealand dollar traded in a tight range against the greenback during a quiet session today.
By 5pm it was buying US68.65c, little changed from the US68.59c it was worth at 8am, despite data showing this country's terms of trade fell 1.9 per cent in the September quarter - a much weaker result than the market expected.
But export volumes were up a seasonally adjusted 5.2 per cent and import volumes up 1.6 per cent suggesting relatively robust economic activity.
Against the Australian dollar, the kiwi was buying A87.72c from A87.30c this morning, against the euro it was at 0.5216 from 0.5197, and 80.12 yen from 79.81.
The gains against the major currencies meant the trade weighted index - at 67.63 from 67.42 this morning - remained around a nine-month high.
The NZ dollar is seen moving with broader market themes in the near-term, with support around US68.20c to US68.30c and resistance at US68.90c.
ANZ bank said financial markets had not reacted significantly to today's terms of trade data.
The terms of trade were expected to remain at an elevated level, supporting a higher currency over the medium term, ANZ said.
Fair value for the New Zealand dollar was above US60c, rather than the historically quoted average of US58c.
"However, this does not alter our bearish view of the currency over 18 months with a material period of over-valuation expected to be followed by undervaluation as the New Zealand economy under-performs."
Meanwhile, the US dollar extended a rebound against major currencies today after solid US jobs data late last week helped alleviate some worries the Federal Reserve may need to trim interest rates early next year.
Coming just after European Central Bank President Jean-Claude Trichet was coy about whether euro zone rates would rise further from 3.5 per cent in early 2007, investors were trimming their big positions favouring the single currency, analysts said.
The following are Reuters currency rates:
5pm today 5pm Friday
NZ dlr/US dlr US68.65c US69.05c
NZ dlr/Aust dlr A87.72c A87.38c
NZ dlr/euro 0.5216 0.5196
NZ dlr/yen 80.12 79.55
NZ dlr/stg 35.20p 35.18p
NZ TWI 67.63 67.52
Australian dollar US78.24c US78.99c
Euro/US dollar 1.3159 1.3286
US dollar/yen 116.69 115.25
- NZPA