$NZ lifts sharply

Press, 30 September 1986, Page 19

$NZ lifts sharply

PA Wellington The New Zealand dollar climbed sharply in a late buying flurry, closing at $U50.4915/25 on the Wellington foreign-exchange market yesterday. It opened at $U50.4860/ 70, steady with its Friday closing after a United States lc rise that day.

The kiwi dollar traded just above its opening level for most of the day before building demand pushed it through a critical support level of SUSO.4BBO in late afternoon trading. Market participants holding short (selling) positions were squeezed and exporters joined the flurry to push the unit higher. “There have been no big volumes; buying support just built up,” a dealer said. “It just started chasing itself,” another added.

Some dealers said much “negative sentiment” disappeared after some big buy orders passed through the market late last week. But one dealer said yesterday’s activity comprised covering of short positions, rather than banks and corporations taking out fresh long positions in the kiwi dollar.

“The kiwi has still not

broken out of its down trend,” he said, adding that a breakthrough $U50.4950 would constitute a major change in direction, he said.

The Reserve Bank’s exchange rate index firmed to 60.1 at 3 p.m., from 59.9 at 9 a.m. and 60.0 at 3 p.m. Friday.

Other values for the kiwi dollar at close were 78.35 Australian cents, 1.001 Deutsche marks, 34.19 p, 75.59 yen and 0.811 Swiss francs. In Sydney yesterday, the Australian dollar finished easier at $U50.6280/87 in dull trading.

The Australian dollar opened at its day’s high of $U50.6290/97 but drifted lower on month-end import selling to 5U50.6270/75 where it met support. The dollar closed in Sydney on Friday at $U50.6285/92 and in New York at 5U50.6285/90. A flurry of late trading in the relatively quiet market was attributed to book squaring and trading bank selling. Traders expect the narrow trading range to continue.