THE New Zealand Dollar fell from close of trade on Friday due to reduced trading, brought about by a public holiday in Wellington. The Kiwi opened last week trading at 1.1945 to the US Dollar and 1.895 to the British Pound.
By Wednesday the Kiwi had firmed ahead of Australian inflation data and after the Bank of Japan came out with an open-minded stimulus programme. The Kiwi continued to strengthen into Thursday on approval of a temporary increase in the US debt ceiling. News that the US House of Representative voted on Wednesday (US time) to approve an increase to the nation’s US$16.4 trillion borrowing ceiling for three months, helped the Kiwi gain on the US Dollar.
The Kiwi Dollar was trading lower by late Friday after failing to break higher against the US Dollar. However, the Kiwi did firm against a weak Yen on a day in which Prime Minister John Key noted the benefits of a strong currency and economists reiterated that it will be strong for much of 2013.
The Reserve Bank of New Zealand is due to meet later this week. Markets still expect the central bank to hold rates but will be watching to see whether there is any change to the rhetoric in the statement following weak fourth-quarter inflation.
Composed by Trevor Brewer
Exchange rates at 08h30 GMT, 28 January 2013
NZD/ JPY: 75.467
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