The New Zealand dollar continued to tail its Australian counterpart yesterday, closing just below US42c.
"(Kiwi) continues to really be driven by the aussie dollar," one local currency dealer said.
At 5pm the kiwi was at US41.95c against US42.19c at Monday's close, having hit an intraday low of US41.85c after the aussie dipped below US51.30c.
The Australian unit ended the local session at US51.30c from US51.60c earlier in the day.
It has benefited in recent days from market talk a bid may be made for Australian miner Western Mining by US-based aluminium giant Alcoa, valuing the company at as much as $A10.5 billion.
An increase in the number of anthrax cases in the US, a shakedown in European stockmarkets overnight and continuing uncertainty surrounding the Afghanistan situation, also appear to have worked in the antipodean currencies' favour.
Dealers expected the kiwi to trade between US41.50c and US42.20c overnight.
"Obviously if the aussie strengthens it will go up, if the aussie weakens it will go down," the local dealer said.
The New Zealand dollar continues to underperform its aussie counterpart on the cross . At 5pm it was buying A81.77c (A82.27c at yesterday's close), while the aussie was buying $NZ1.2230 ($NZ1.2155).
On the other crosses, the kiwi was buying 0.4624 euros (0.4617 at Monday's close), 50.65 yen (51.06), 28.95 pence (29.01), 0.9043 marks (0.9033), and 0.6827 Swiss francs (0.6840).
The 90-day bill yields were at 5.14 per cent (5.21), the trade-weighted index was at 49.68 (49.89) and the monetary conditions index was at minus 884 (minus 855).
Among the bonds, the March 2002s were at 4.98 per cent (5.04), the April 2004s were at 5.31 per cent (5.35), the November 2006s were at 5.96 per cent (6.02) and the November 2011s were at 6.51 per cent (6.56).
- NZPA
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