NZ dollar gains from eight-month low ahead of Thanksgiving

NZ dollar gains from eight-month low ahead of US Thanksgiving holiday

By Paul McBeth

Nov. 24 (BusinessDesk) – The New Zealand dollar rose from an eight-month low in the local session as some investors were lured to the relatively high-yielding currency ahead of the US Thanksgiving holiday.

The kiwi dollar rose to 74.37 US cents at 5pm from 74.17 cents at 8am, and was down from 74.40 cents yesterday.

Equity markets reported modest gains through much of Asia in afternoon trading, with Australia’s Standard & Poor’s/ASX 200 index up 0.2 percent and Hong Kong’s Hang Seng index up 0.5 percent. That comes ahead of the Thanksgiving Holiday in the US, which will likely see bargain hunters come out of the woodwork during illiquid trading and after prices for so-called risk-sensitive assets tumbled amid the downbeat tone.

“If we see things pop higher this weekend, it’s going to be profit taking moves rather than a turn in sentiment,” said Alex Hill, senior currency strategist at HiFX. “If the kiwi can stay above 73.80 US cents over the close this weekend, we may have seen a temporary bottom.”

Still, ongoing fears about Europe’s ability to repay sovereign debt are weighing on investor confidence and traders will continue to shy away from riskier assets.

“All eyes will be on Germany’s GDP” after it failed to sell more than a third of its government bonds at auction on Wednesday, Hill said. “The only thing domestically that would change the currency would be a very strong statement from the Reserve Bank.”

The kiwi was little changed at 57.31 yen from 57.29 yen yesterday, and rose to 76.31 Australian cents from 76.13 cents. It increased to 47.80 pence from 47.62 pence, and gained to 55.59 euro cents from 55.23 cents yesterday.

The trade-weighted index increased to 66.50 from 66.31.

(BusinessDesk)

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