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NZ Dollar Gains On Data And Short Squeeze

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, April 29 NZPA - The New Zealand dollar rose today on a combination of positive economic data and traders cutting out positions.

The focus is turning to the Reserve Bank of New Zealand's official rate decision tomorrow and there was some positive economic data today to alter the picture the bank considers.

New Zealand recorded its largest trade surplus for a March month in dollar terms since 2002 and a survey recorded a big improvement in the sentiment of business people.

By 5pm the NZ dollar was buying US56.58c, up from US55.40c yesterday.

"The currency has been perky pretty much all day," said BNZ Capital currency strategist Danica Hampton.

"People got frustrated with it not falling and there was a squeeze on short positions," she said.

This took the currency to around US56.40c and the National Bank Business Outlook survey, which recorded an improvement in outlook, helped the currency rise further.

Overnight US Gross Domestic Product data and a statement from the Federal Open Market Committee are among factors that could change the global backdrop this market operates in.

At 5pm the NZ dollar was at 0.4295 euro from 0.4264 yesterday.

Against the Australian dollar it was at A79.45c, up from A79.05c yesterday.

The NZ dollar lifted to 54.75 yen from 53.20, and the trade weighted index was up to 56.25 from 55.43.

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