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Currency: NZ dollar rises above A82C
5.15pm Tuesday August 8, 2006
The New Zealand dollar continued to rise against most currencies today, especially the Australian dollar, where it closed above A82.12c. The kiwi had started the session near yesterday's closing level of A81.82c. Against the US dollar, the kiwi dipped overnight but recovered nearly all that, ending on US62.60c from its US62.43c opening and US62.65c at 5pm yesterday. Markets are on hold ahead of the US Fed's decision on rates expected tomorrow morning (NZT). After more than two years of raising interest rates, the US Federal Reserve is widely seen as holding rates steady at 5.25 per cent. But high energy prices -- oil prices rose more than US$2 a barrel overnight -- and rising US inflation gauges may force the Fed to tighten further after it takes the anticipated pause. ANZ Bank today said that after failing to break US62.80c overnight, the NZ dollar would have to bide its time in a range between US62.20c to US62.70c as the market became increasingly nervous about its call that the Fed would pause raising US interest rates. The trade-weighted index closed on 62.36 from 62.13 yesterday. The US dollar hovered near two-month lows against a basket of currencies in Tokyo trading today. Some analysts say the dollar could see a rebound if the Fed strikes a tough inflation-fighting stance in the statement's wording and keeps alive the prospect of more rate increases that would help the dollar maintain its yield advantage. "There is uncertainty over the Fed's policy course given signs of growth slowing but strong inflationary pressures," said Nobuo Ibaraki, forex manager at Nomura Trust and Banking. Rates: 5pm today 5pm Monday
NZ dlr/US dlr US62.60c US62.65c
NZ dlr/Aust dlr A82.12c A81.82c
NZ dlr/euro 0.4882 0.4866
NZ dlr/yen 72.07 71.75
NZ dlr/stg 32.86p 32.87p
NZ TWI 62.36 62.13
Australian dollar US76.23c US76.57c
Euro/US dollar US1.2821 US1.2875
US dollar/yen 115.12 114.54 - NZPA
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