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Kiwi touches three-month high

NZ Newswire logoNZ Newswire 8/06/2017 Paul McBeth

The New Zealand dollar has edged higher, touching a new three-month high, as investors largely shrugged off testimony by former US Federal Bureau of Investigation chief James Comey and after the European Central Bank was more upbeat on the regional economy.

The kiwi rose as high as US72.22 cents, the highest since February 28, and was trading at US72.15c as at 8am on Friday in Wellington from US71.96c on Thursday. The trade-weighted index gained to 77.53 from 77.32.

The US Dollar Index rose and the Chicago Board Options Exchange's Volatility Index, known as Wall Street's fear gauge, eased after former FBI director Mr Comey's US Senate testimony wasn't seen as offering overwhelming evidence President Donald Trump attempted to obstruct the course of justice during the FBI's probe into Russian interference with the US election.

Meantime, the ECB dropped its easing bias and upgraded its economic outlook in the latest move by a major central bank towards normalising monetary policy. The kiwi rose to 64.32 euro cents from 63.98c.

"Two of the three major risk events for this week have now passed with no adverse market reaction so focus now turns to the UK election, where the first exit polls will be released from about 9am," BNZ currency strategist Jason Wong said.

"The NZD continues to outperform, while the USD has also been well bid, although currency movements have been modest."

On Friday morning, the kiwi increased to 55.74 British pence from 55.55p as polls in the UK election prepare to close. It rose to 95.58 Australian cents from A95.36c and gained to 4.9055 Chinese yuan from 4.8912 yuan. It increased to 79.35 yen from 78.95 yen.

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