Kiwi holds

Press, 11 October 1986, Page 26

Kiwi holds

PA Wellington Profit taking made the New Zealand dollar dip under 51 U.S. cents on the Wellington foreign-exchange market yesterday before recovering to a steady 5U50.5105/15 near the close, down from its opening of 5U50.5112/22. The kiwi dollar was dealt in a tight range from 5U50.5090 to 5U50.5015 all day. When the unit fell below 51 U.S. cents, exporter buying came in to support it, but corporate and finance house profit taking prevented any major rise, dealers said. Although there were reasonable volumes going through the market was quiet. The unit is expected to test 52 U.S. cents soon, probably over the next week. One dealer said that exporters would probably soon be saying the New Zealand dollar was too high and was harming their income. The unit had sunk to around 47 U.S. cents last month, but has risen steadily since then. After holding off when the kiwi dollar was under 50c exporters were now buying before it moved any higher, the dealer added. Cross-rate values for the New Zealand dollar in the afternoon were 79.99 Australian cents, 1.02 Deutsche marks, 35.8 p, and 79 yen. The Reserve Bank trade-weighted index eased marginally to 62.7 at 3 p.m. from 62.8 in the morning. In late European trading on Thursday (early yesterday, N.Z. time), the United States dollar and the pound firmed slightly, but this was mainly on a bout of short covering and the underlying prospects for both currencies remained bearish. The pound closed at 67.5 on its trade-weighted index, above its opening of 67.3, but well below the day’s high of 67.8. The pound ended at 2.8455/505 DM, above Wednesday’s final of 2.8370/ 8400 DM and Thursday’s opening at 2.8450/85 DM, but well below the midday highs of about 2.8630 DM. Against the U.S. dollar, which firmed over all on the day, it closed at $U51.4210/20 against its opening of 5U51.4252/62, although it was above Wednesday’s close of 5U51.4195/4205.