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NZ Dollar Stronger As Greenback Hit By Weak Consumer Confidence

Fuseworks Media
Fuseworks Media

Wellington, May 19 NZPA - The New Zealand dollar lifted from multi-month lows towards the end of last week as the greenback took a hit from a plunge in United States consumer confidence.

By 8am today the kiwi was buying US77.41c, just shy of its highest level in a week, after having been at a near-four month low around US75.35c on Thursday night.

In its morning briefing notes today, the ANZ bank said a stronger Australian dollar and mild yield demand for the kiwi had dragged the NZ dollar higher overnight on Friday.

The US dollar remained under downward pressure, dragged down by weak consumer sentiment and higher oil prices that threatened economic growth, ANZ said.

Against the aussie, the NZ dollar's eight-week slide took a breather having hit a 21-month low near A80.50c early on Friday.

From A80.87c at 5pm on Friday, the kiwi bounced around between about A80.70c and A81.25c to be at A81.09c by today's local open.

The kiwi also pulled itself back from a 21-month low against the euro of around 0.4860 on Thursday night. By 8am it was at 0.4966 from 0.4938 at Friday's local close.

The NZ dollar was also buying 80.55 yen at today's local open from 80.01 at 5pm on Friday. The trade weighted index was 68.97 at 8am today from 68.45.

The US dollar fell as a plunge in US consumer confidence raised concerns about an economic contraction in the second quarter and trimmed the chances the Federal Reserve will raise interest rates this year.

The unexpectedly sharp drop in a consumer sentiment index to a 28-year low in May eclipsed a report showing a rebound in building permits and construction starts for new US homes, which briefly triggered some US dollar buying.

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