Kiwi strength continues

05:40, Sep 17 2012

The New Zealand dollar rose against the greenback today as investors digested news out late last week that the United States would enter its third round of quantitative easing.

The central bank will buy billions of dollars of its own bonds until the local unemployment rate improves in an attempt to boost the American economy.

The kiwi recently traded at US82.79c, up from US82.75c. On the trade weighted index against major trading partners' currencies it was at 73.20, up from 73.14 earlier.

ASB Institutional head of institutional FX sales Tim Kelleher said the kiwi had a reasonably quiet day.

"It just drifted off. We've seen the US dollar regain some ground all day long against the euro and certainly against the aussie and kiwi. We've seen further selling of kiwi against the euro as well. There was not anything too dramatic but there was certainly profit taking on the crosses," Kelleher said.

"The higher US yields is attracting some buying of the US dollar. The kiwi had a strong week last week and this week we've got a lot of data coming out [including GDP on Thursday]."

On the crosses the kiwi was at 78.58 Australian cents, up from A78.45c earlier. It was at 64.83 Japanese yen, down from 64.84 yen earlier. It was at 63.03 euro cents, down from 63.08 euro cents earlier. It fell to 51.01 pence, from 51.03 pence earlier.

Kelleher expected the kiwi to trade between US82.50c and US83.00c overnight with a bias towards the downside.

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