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Small Range For NZ Dollar For Most Of Overnight Session

Contributor:
Fuseworks Media
Fuseworks Media

Wellington, March 28 NZPA - The NZ dollar spent most of the night trading in a range between US80.30c and US80.60c against a backdrop of steady European equity markets.

By 8am today the kiwi was buying US80.37c, slightly down from US80.50c at 5pm yesterday.

Bank of New Zealand currency strategist Danica Hampton said the NZ dollar had traded a more subdued range overnight, with markets continuing to arm-wrestle mood swings in equity markets with ongoing poor United States dollar sentiment.

The greenback rallied after suffering steep losses in the last two sessions, rising on data showing the US economy grew in the fourth quarter in line with market expectations.

The data, coupled with a separate report showing a decline in jobless claims in the latest week, did not change the market's view about the need for further US interest rate cuts to boost a weakening economy. But it did ease concerns about a much sharper slowdown.

Shortly before the New Zealand market's local open, the greenback extended gains against the yen after results of the Federal Reserve's $US75 billion ($NZ94.5 billion) Term Securities Lending Facility showed that banks were not in dire need of funding.

"The market was happy that not too many people needed liquidity. It means banks are not in dire need of cash. That's viewed as (US) dollar positive," said Steven Butler, director of FX trading at Scotia Capital in Toronto.

The kiwi strengthened against the yen overnight, to 80.24 yen at 8am today from 79.50 at 5pm yesterday.

It was little changed against the euro and the Australian dollar, up to 0.5094 euro compared to 0.5087, and slipping to A87.31c from A87.38c. The trade weighted index was up to 71.31 from 71.21.

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