Kiwi gains on Greek funding hopes

Last updated 08:53 26/11/2012

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The New Zealand dollar has risen against the greenback, following the euro higher on speculation international lenders are close to releasing further Greek funds.

The kiwi recently traded at US82.35 cents, up from US81.63c at 5pm on Friday, while on the Trade Weighted Index of major trading partners’ currencies it rose to 73.69 from 73.27.

The New Zealand dollar rose to a three-week high against the US dollar on Friday after reports claimed the International Monetary Fund had relaxed some of the bailout conditions placed Greece, paving the way for the heavily indebted country to receive its next tranche of bailout funds as soon as this week.

Appetite for growth-linked currencies such as the kiwi and Australian dollar was also bolstered by the Standard & Poor’s 500 Index chalking up its biggest weekly gain in five months.

“Some stabilisation seems in order with little to extend Friday’s moves,” said ANZ in a daily current note. “Unrest in Egypt, Catalonia elections, and the European Greek summit have the potential to unwind some gains, but for now, gains look set to persist.”

The yen remained on a downward track, as traders speculated the Liberal Democratic Part will win the upcoming December election. The kiwi rose to 67.76 yen from 67.10 yen on Friday. In the run up to the poll, party leader and current prime minister, Shinzo Abe, has promised to reform the Bank of Japan and institute a massive programme of quantitative easing to boost the country’s ailing economy and its elevated exchange rate, which has weighed on the yen for several weeks.

On the crosses, the New Zealand dollar recently traded at 78.71 Australian cents, up from A78.51c yesterday, it rose to 63.38 euro cents from 63.32 euro cents, and it gained to 51.29 pence from 51.16p.

ANZ said the kiwi is expected to trade between US81.80c and US82.60c today, with the bias tipped to the upside.

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