Kiwi holding US57c mark

Press, 22 July 1989, Page 27

Kiwi holding US57c mark

PA Wellington The New Zealand dollar ended the week 62 points up on its opening quote on Monday morning, but down from its high yesterday, when it closed at U557.10/20C. It closed at 57.00/10 on Thursday and opened at 56.47/57. It moved in a 52-point range and never fell below USS7C.

The New Zealand dollar’s firmer opening, well above the US57c level and 40 points up on its previous close, was on short-covering late on Thursday and a weaker U.S. dollar overnight, a dealer said.

A slide began in early trading, however, and at noon the New Zealand dollar had settled around 57.22/32.

Dealers said there was good two-way early business in small parcels and they were looking for a break of 57.50 c

Early sentiment was bullish as dealers said they expected topside breaks to be helped along by offshore interest in the New Zealand bond market.

The five-year bond rate finished at 12.95 per cent after slipping 12.99% around mid-morning from its close last night of 13.03% and recent 13.1% levels. On the cross rates at yesterday’s close, compared with this morning, the New Zealand dollar was weaker at Aust76.loc and 1.08 marks, steady at 35.29 p, firmer at 81.23 yen, and lower at 0.9404 Swiss francs.

The Reserve Bank trade weighted index closed slightly lower at 59.4 after it had opened firmer at 59.5 against

its 3 p.m. fix on Thursday of 59.1. A week ago it closed at 58.9 and a month ago at 60.8.

The Australian dollar closed firmer at U575.00/07 after uninspired trading in a narrow range.

The currency eased from its 75.19/24 opening, but was up from Thursday's 74.85/92 finish.

June quarter consumer price index data due next week, which market forecasts predict will be between 2.1 per cent and 2.7%, is expected to place downward pressure on the unit, a dealer said.

Against the Kiwi, the Australian dollar firmed to NZL3IIB/54 from 1.3108/32.

In New York the United States dollar fell in light New York trading on Thursday (early yesterday, N.Z. time). It was pressured by the intimation by Federal Reserve Board chairman, Mr Alan Greenspan, that the Fed was more worried about the risk of recession than inflation.

However, the dollar rebounded from its lows of the day, boosted by Greenspan’s suggestion that the Fed would not ease monetary policy further imminently. "His approach was very balanced,” said Francoise Soares-Kemp of Credit Suisse.

The dollar closed at 1.9043/53 marks, down from Wednesday’s finish of 1.9130/ 40 Deutsche marks and at •141.27/32 yen, down from 142.50/60 yen. It opened almost unchanged from Wednesday’s finish and then fell to a low of 1.9890 marks shortly before noon.