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NZ dollar firms on US vote, traders await Chinese data

NZ dollar firms on US vote, traders await Chinese data

Jan. 24 (BusinessDesk) – The New Zealand dollar firmed slightly on approval of a temporary increase in the US debt ceiling, which came after a mixed session overnight.

The kiwi was at 84.18 US cents at 8am, up from 84.05 cents at 5pm. It traded as high as 84.41 cents overnight.

News that the US House of Representative voted on Wednesday US time to approve an increase to the nation's US$16.4 trillion borrowing ceiling for three months moved the kiwi from about 84.10 cents to 84.22 cents in morning trading here.

Without the vote, the US Treasury would not have had enough money to pay all of its obligations by late February, raising the risk of a default.

“I would have thought kiwi would have moved more than that,” Imre Speizer, senior markets strategist at Westpac, said.

With the US vote out of the way the focus has turned to the HSBC Purchasing Managers' Index report from China, due at 2.45pm NZT.

“These things have been ticking higher. I’d expect it to continue and help the kiwi upwards,” Speizer said
.
Otherwise traders noted that the International Monetary Fund had trimmed its 2013 forecast for global growth to 3.5 percent from the 3.6 percent it projected in October.

But it forecast a 4.1 percent expansion in 2014.

Europe's markets had closed before the US vote after absorbing mixed corporate earnings but Wall Street rose following the vote.

Strong earnings reports from IBM and DuPont also helped sentiment.

The kiwi was at 79.80 Australian cents, little changed from 79.78 cents at 5pm on Wednesday.

It was at 74.57 yen from 74.48 yen, and at 63.21 euro from 63.14 euro. It rose to 53.15 British pence from 53.09 pence.

The trade-weighted index was at 75.47 from 75.45

(BusinessDesk)

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