Dollar climbs above 66USc as calmer markets stoke risk appetite
Kiwi rose to 66.05 US cents at 8am.
The New Zealand dollar rose above 66USc for the first time in six-and-a-half weeks as reduced volatility in global markets stoked investors' appetite for risk-sensitive assets, pushing up equities and commodity-linked currencies.
The kiwi rose to 66.05USc at 8am in Wellington form 65.88c yesterday. The trade-weighted index was little changed at 71.15 from 71.17 yesterday.
The Chicago Board Options Exchange's Volatility Index, known as Wall Street's 'fear gauge', fell to its lowest level in seven weeks as investors assess the pace and timing of higher US interest rates, and have fewer qualms about the strength of emerging market economies.
That's helped push up equity markets, with stocks on Wall Street and Europe gaining in the northern hemisphere trading session, while rising dairy prices have allayed fears about the strength of New Zealand's economy, paring back bets on another rate cut and stoking demand for the kiwi.
"Broad stabilisation in risk appetite, combined with a less gloomy outlook for the NZ dairy sector, appears to have extended recent upward momentum," Bank of New Zealand senior market strategist Kymberly Martin says.
"This has likely taken the market by surprise, given recent data showed the speculative community maintained NZD 'short' positions, despite no longer being at extremes."
The local currency rose to 79.17 yen at 8am in Wellington from 78.96 yen after the Bank of Japan yesterday kept monetary policy unchanged and affirming plans to expand its monetary base by 80 trillion yen a year.
The kiwi rose to 4.1981 Chinese yuan from 4.1854 yuan yesterday, with China coming back from its Golden Week holiday today.
It gained to 58.71 euro cents from 58.38c yesterday after German industrial production reported an unexpected decline, and was little changed at 43.11 British pence from 43.16 pence after UK manufacturing beat expectations.
The local currency was little changed at 91.68Ac from 91.65c yesterday.
(BusinessDesk)
Paul McBeth
Thu, 08 Oct 2015
Thu, 08 Oct 2015
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Dollar climbs above 66USc as calmer markets stoke risk appetite
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