Quiet night for NZ dollar

MARIA SLADE
Last updated 08:36 01/03/2013

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The New Zealand dollar remained stable overnight, as international markets quietened after a week of volatility.

The kiwi recently traded at 82.79 US cents, down from US83.15c at 5pm yesterday. On the Trade Weighted Index of major trading partners' currencies it was at 75.91, up from 75.80 last night.

Global markets were pulled higher overnight by encouraging US economic data and renewed confidence that major central banks will keep taking steps to support the global economy.

The US Commerce Department said gross domestic product rose 0.1 per cent in the fourth quarter - reversing a previous reading showing a contraction, but less than a 0.5 per cent gain forecast by analysts in a Reuters poll.

However it joins a string of other data that continue to point to recovery.

European equities and bonds did well as prospects for a functioning Italian coalition appeared to have improved, ANZ said.

The European Stoxx 600 index closed up 0.96 per cent to 289.94, while the S&P 500 was recently up 0.51 per cent at 1523.74.

HiFX currency strategist Alex Hill said the euro fell below 1.31 against the US currency following an advisory report saying the European Central Bank may discuss interest rates next week.

"That's caused a bit of weakness there and obviously the kiwi's followed that to a degree," Hill said.

But generally it was a quiet night with a drop in volatility after a week which had seen a fair amount of it, he said.

"We've started getting used to a bit of whippiness there for the last few days."

The New Zealand dollar was expected to trade in a range of US82.50c to US83.30c today, Hill said.

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- BusinessDay.co.nz

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