NZD up after cash rate announcement

JAZIAL CROSSLEY
Last updated 17:35 25/10/2012

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Currencies

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The New Zealand dollar rose against the greenback today following new Reserve Bank governor Graeme Wheeler's first Official Cash Rate announcement where he confirmed interest rates would remain on hold at a record low of 2.5 per cent.

The kiwi recently traded at US82.16c, up from US81.76c in the morning. On the Trade Weighted Index against major trading partners' currencies it was at 73.40, up from 73.06 earlier.

HiFX senior currency strategist Dan Bell said Wheeler's statement was slightly less dovish than the market expected.

"It wasn't preparing the market for a rate cut as some were hoping. It led to a rally in the New Zealand dollar which has seen the kiwi-US cross trade to a high of US82.34c this afternoon," Bell said.

"Overnight the focus is on US economic data on durable goods and home sales which should give another take on how the US economy is performing."

On the crosses, the kiwi recently traded at 79.31 Australian cents, up from A78.83c in the morning. It was at 63.34 euro cents, up from 62.87 euro cents earlier. It rose to 51.22 pence from 50.84. It was at 65.68 Japanese yen, up from 65.06 yen earlier.

Bell expected the kiwi to trade between US81.80c and US82.50c overnight.

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- © Fairfax NZ News

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