The New Zealand dollar rose against its Australian counterpart after weak business confidence data across the Tasman.

The kiwi was trading at 95.19 Australian cents at 5pm from 94.95 cents at 8am. It was at 66.29 US cents from 66.20 cents.

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National Australia Bank's index of business conditions rose 2 points to +3 index points, reversing a decline in May. In contrast, the survey's measure of business confidence retraced its gains and fell 5 points to +2 index points in June.

"Overall, the survey results for June continue to suggest that the business sector has lost significant momentum over the past year or so," according to NAB Australian Economics. "The recent run of results also suggest that the economy is unlikely to record a significant pickup in growth in Q2," it said.

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Kiwibank trader Mike Shirley said the kiwi had already been drifting higher against the Aussie and the lift on the data "was more of a trend continuation than anything else."

Key for the cross will be Chinese inflation data, due early tomorrow afternoon New Zealand time. In May, the consumer price index rose 2.7 per cent from a year earlier, with significant increases in food prices. According to Xinhua – quoting Securities Daily – the CPI is expected to lift 2.6 per cent year-on-year in June.

China is the major trading partner of both Australia and New Zealand.

Markets, however, are largely biding their time ahead of minutes from the US Federal Reserve's June meeting - due Wednesday in the US - and chair Jerome Powell's testimony to Congress on Wednesday and Thursday. Most investors are betting on the Fed cutting rates by 25 basis points at the end of the month.

The kiwi traded at 52.97 British pence from 52.91 pence yesterday, at 59.08 euro cents from 59.06, at 72.06 yen from 72.03, and at 4.5603 Chinese yuan from 4.5544. The trade-weighted index was at 72.67 versus 72.55.

The New Zealand two-year swap rate was at 1.3138 per cent from 1.3045 late yesterday, while the 10-year swap rate was at 1.7125 per cent from 1.7250 per cent.