Kiwi gets push, $US falls sharply
PA Wellington Widespread buying from the domestic, corporate and interbank markets and early demand from New York pushed the New Zealand dollar higher in moderate trading yesterday. The currency closed at 5U50.5378/85 against its $U50.5320/27 start and $U50.5275/85 finish on Monday.
“We will have to wait and see what happens overnight but it looks headed toward old highs ... it is well supported,” a dealer said. Dealers said firm interest fates in New Zealand are underpinning the local currency.
Some dealers said the release of a better-than-expected Australian December current account during the session was bullish for the local unit. The sAust64B million for December was considerably lower than expec-
tations of about sAust9oo million.
Buying following the current account figure pushed the Australian unit to $U50.6610/27 at close against its $U50.6543/50 start and $U50.6430/37 finish on Monday.
Some dealers said the New Zealand unit will rise above US54c today while others said profit-taking will stop a significant rise in the short-term although the underlying trend is upward.
Wholesale cross rates for the kiwi dollar late yesterday were AustBi.3c, 0.98 deutsche marks, 35.1 p, 81.8 yen, and SHK4.I. And in Sydney the Australian dollar closed higher at 5U50.6635/42 in a strong return of confidence following the release of December balance of payments data. The dollar’s close was USlc up from its opening of 5U50.6536/38 and ahead of Monday’s 5U50.6490/97 close. Meanwhile, in New York the US dollar closed with sharp losses after a dull trad-
ing session, but failed to breach record lows set in Asia as reports of official pressure for a further depreciation added to the currency’s problems.
With US banks closed for the Martin Luther King holiday, trading was severely limited.
The dollar closed at 151.60 Japanese yen, up from its post-war low of 149.98 to which it fell earlier in Asia, but well down on its previous New York close of 153.20.
The dollar also fell to 1.8175 dm from 1.8415 on Friday and to 1.5220 Swiss francs from 1.5420.
Against sterling the dollar closed at £1.5303, down from £1.5405 at the opening, but up from £1.5190 on Friday.
And Japanese Finance Minister Kiichi Miyazawa said he will go to Washington for talks on currency rates with U.S. Treasury Secretary, Mr James Baker.
Mr Miyazawa told reporters that he proposed the talks because the dollar has plunged below levels prevailing when the U.S.-Japanese agreement on currency market stability was announced at the end of October.
Kiwi gets push, $US falls sharply
Press, 21 January 1987, Page 23
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