WELLINGTON/SYDNEY: The New Zealand dollar was near a 30-year high against the greenback in early trade on Monday, while the Australian dollar dipped as dire jobs data from the US threw markets into a spin.
Markets also had to contend with Chinese data showing a food-driven pick up in inflation and a slowdown in annual import growth.
Given the negative news both the kiwi and Aussie have held up remarkably well. The New Zealand dollar closed New York trade on Friday at $0.8384, its best since 1981, before opening locally slightly lower at about $0.8357.
The kiwi pushed to its high despite the very weak US jobs data which saw stock markets and commodities skid. Currency markets were mixed after the data, with the greenback slumping against safe havens such as the yen and the Swiss Franc.
The Aussie dollar trades at $1.0720, vs $1.0752 late in New York. The currency is currently near support levels at $1.0709, with the next topside hurdle at $1.0790.
No forex reaction to the Australian government's carbon tax announcement which is not seen having much of an implication for the economy or monetary policy.
The New Zealand currency may launch a renewed assault at $0.8400, a level last seen in November 1981, when the exchange rate was managed. Support at $0.8325 with resistance at $0.8379 and then $0.8400.
Analysts pick the US dollar to slide this week as the pressing debt ceiling issue shows no sign of resolution and the jobs data well below expectations suggests the Fed will keep rates low well into next year.
The kiwi's strong performance saw the Aussie/kiwi cross stumble to a one-month low of NZ$1.2803, before recovering a little to last be at NZ$1.2838.
Monday sees electronic card spending data for NZ due, while Australia has housing finance. For the rest of the week NZ has June housing sales data from QV and REINZ as well as the much-delayed Q1 GDP. Australia has NAB business conditions on Tuesday and consumer sentiment on Wednesday.
NZ government bond prices firmer as US Treasuries rallied on Friday on fresh fears the economy was slowing, with yields up to 1.5 basis points lower.
Australian three-year bond futures jumped 0.10 points to 95.320, with the 10-year contract 0.105 points higher at 94.860.
Copyright Reuters, 2011
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