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NZ Dollar Eases Back From Upward Spike

Contributor:
Fuseworks Media
Fuseworks Media

(correcting h9874, changing yesterday's close in par 6)

Wellington, March 26 NZPA - The New Zealand dollar eased back from an upward spike precipitated by a US dollar retreat on rising gold and commodity prices.

Renewed calm in financial markets prompted traders to get back into carry trade currencies like the kiwi. However, today's dire fall in consumer confidence saw the kiwi retreat on its major cross rates.

Consumer confidence in the US also sagged.

The euro surged more than 1 percent against the US dollar from the previous day after US data showing consumer confidence hitting a five-year low and house prices falling in 16 of 20 regions. Analysts said the economy may already be in a recession.

Currency strategists at UBS said central banks appeared to have done enough in the short-term to stabilise market sentiment and had provided much-needed breathing space for risk appetite.

The kiwi closed on US80.31c compared with its US80.71c opening and yesterday's close at US80.15c.

The kiwi touched a near-seven-week high against the Australian dollar early today at A88.17c but retreated to A87.70c by the close compared with A88.0c at the same time yesterday.

The trade weighted index ended on 71.50 from 71.63.

NZPA WGT Reuters sml dj

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