NZ dollar rises in thin trading at US dollar remains weak
By Rebecca Howard
Dec. 28 (BusinessDesk) - The New Zealand dollar rose in very thin trading as it continued to benefit from ongoing US dollar weakness and a lift in commodity-linked currencies.
The kiwi rose to 70.75 US cents as at 5pm in Wellington from 70.46 cents late yesterday. The trade-weighted index rose to 74.07 from 73.96.
The New Zealand dollar is "mildly elevated," said Kiwibank senior dealer Mike Shirley. "It's holiday thin trading and there is broad, very mild US weakness. We are winning by default," he said.
The US dollar has slipped as traders increasingly expect that other major central banks will also begin reducing their monetary stimulus next year as global economic growth picks up, reducing any potential yield differential between US rates and interest rates in other countries. The kiwi was also helped by a lift in the Australian dollar as copper held near a four-year high, gold was around a one-month high and oil prices remained firm. The Australian dollar hovered around a two-month high at 77.82 US cents.
The kiwi fell to 90.89 Australian cents from 91.03 cents late yesterday.
With very little data on the immediate horizon at home or abroad, Shirley said trading will remain very light until year end.
The local dollar rose to 80.05 yen from 79.78 yen and rose to 4.6289 yuan from 4.6180 yuan. It was little changed at 59.39 euro cents from 59.38 cents and rose to 52.72 British pence from 52.67 pence.
New Zealand’s two-year swap rate was unchanged at 2.21 percent and the 10-year swaps eased three basis points to 3.14 percent.