NZ dollar holds unexpected gains
The New Zealand dollar has held its unexpected gains against a basket of currencies, trading at US82.89 cents, from US81.96c at 5pm on Friday.
The trade-weighted index of major trading partners' currencies was 77.1.
The kiwi dropped from US81.99c to US81.39c following positive US payrolls data early Saturday morning, but quickly reversed its losses to jump to US82.62c at 5am today.
Westpac market strategist Imre Speizer said it wasn't clear why the kiwi gained.
The big market story was the US payroll data, and the results should have pushed up the US dollar, Speizer said.
US jobs data for November showed monthly payroll gains of 203,000 and the jobless rate fell to a five-year low of 7 per cent.
The November gain followed a revised 200,000 increase in October and exceeded expectations so the kiwi's gain against the greenback was not what the market was predicting, Speizer said.
"The kiwi was one of the outperformers," he said.
Speizer said he expected the kiwi to trade between US82.60c and US83.50c today.
The New Zealand dollar also hit new highs against the aussie, not seen in more than five years.
The kiwi recently traded at A91.10c from A90.43c on Friday night, after hitting a high of A91.18c early Saturday morning.
Speizer said it was hard to predict whether the New Zealand dollar would correct its gains against the currencies.
He said he expected the New Zealand dollar to trade between A90.20c and A91.50c today but it could go higher, adding: "The sky's the limit."
- © Fairfax NZ News