Wide $NZ spread as SUS tumbles

Press, 13 March 1985, Page 34

Wide $NZ spread as SUS tumbles

PA Wellington The New Zealand dollar traded in big margins from its low of ?U50.4370/00 to its high at yesterday’s opening at ?U50.4720/50 - on the foreign-exchange market in Wellington.

Against the Australian dollar the New Zealand unit was worth 64.5 Australian cents, compared with about 60c at the start of the float. Against the pound, the New Zealand dollar was at 41.5 p. Dealers said the local unit had support from exporters at below $U50.4400 and from importers above $U50.4500. The U.S. dollar traded soft on the foreign-exchange market, closing unchanged from its opening at 3.3200/ 20 marks after diving 7 pfennigs overnight.

The dollar reached a low of 3.3100 during the day. In yen the dollar closed at its

high for the day at 259.20/ 30. Dealers said sterling did not now look like breaking JUSI.IO, closing in Wellington at ?U51.075/85 after opening at $U51.0960/70. The Australian dollar traded comfortably to close at ?U50.7050/60, little changed from its opening of $U50.7070/80. Overseas, the U.S. dollar tumbled on world foreign exchanges on Monday (Monday night and yesterday morning, N.Z. time, undercut by falling interest rates and expectations of slower economic growth in the United States. The U.S. Federal Reserve Board said its measure of the dollar, weighted for trade against the currencies of 10 other industrial nations, fell 1.6 per cent from Friday’s levels. But unlike the steep, 1.9 per cent decline of February 27, which followed huge intervention, there were no signs of central bank sales of dollars on Monday. In Europe, the interest rate on one-year U.S. dollar deposits fell more than a quarter of a percentage point, and in the United States, some shortterm interest rates fell a tenth of a percentage point. Even with the decline on Monday, the U.S. dollar still was 5.6 per cent higher than it was when the year began and 86.4 per cent higher than when the 1980 s began. By the end of the trading day in the United States on Monday, the dollar had slumped to 258.85 Japanese yen from 260.775 yen late on Friday. The British pound climbed to JU51.0962 from $U51.06925 late on Friday.