Optimism, spending boost kiwi
The New Zealand dollar is the highest it has been against the greenback this month as the US currency pulled back from three-year highs and the kiwi pushed forward on good business optimism and retail spending.
The New Zealand dollar was trading at US78.57 cents shortly before 8am.
The Trade Weighted Index of major trading partners was 74.6 this morning.
The kiwi was up after trading as low as US76.86c on Saturday on the back of strong US jobs data that supported the decision to end the Federal Reserve's US$85 billion-a-month (NZ$108b) bond-buying scheme.
BNZ market strategist Kymberly Martin said positive local data helped push the New Zealand dollar up to two-week highs.
Business optimism hit its highest level in more than three years, the New Zealand Institute of Economic Research's latest Quarterly Survey of Business Opinion showed yesterday.
The report showed a net 31 per cent of businesses remained optimistic (excluding seasonal adjustments), the highest level since the March 2010 quarter when it hit 33 per cent.
Yesterday's card-spending data for June was also strong, with shoppers spending nearly 6 per cent more than they did a year ago.
Electronic card spending in the retail sector rose a seasonally adjusted 1.1 per cent in June, with fuel and hospitality leading the rise.
Shoppers pushed up spending on their debit and credit cards across all retail sectors in June for the first time since August last year.
Total card spending was up 1.2 per cent. Core retail spending, which excludes vehicle-related industries, increased 0.7 per cent.
The New Zealand dollar-US dollar cross was the "strongest performer of its peers" during the past 24 hours, Martin said.
The data reaffirmed New Zealand's position against the aussie with the kiwi trading at A85.42c this morning.
Markets were watching Chinese trade data out today and US central bank minutes released tonight (NZT), which could temper further gains in the local currency.
- © Fairfax NZ News