23 Dec 2013

Dollar drifts lower, market rallies

9:55 pm on 23 December 2013

The New Zealand dollar has drifted lower against the currencies of all our major trading partners.

Bancorp Treasury Services client adviser Peter Cavanaugh said the key decline was from its five-year high against the Australian dollar, which peaked at 92.88 cents last week.

Exterior of the NZ Stock Exchange building, Wellington

Photo: PHOTO NZ

"It's really only drifting, very thin, pre-holiday trading. If anything, the pressure is coming through the New Zealand-Australian exchange rate, which has drifted below the 92 cent level," Mr Cavanaugh said.

"It's been felt by many that above 92 (cents) it fully factored in all New Zealand's relative positives and many people are just positioning accordingly, and also looking ahead for the Christmas and New Year break."

Just after 5pm, the New Zealand dollar was buying: 81.93 US cents, 91.79 Australian cents, 50.13 pence, 0.5992 euro and 85.25 yen.

Stock market rallies

The stock market rallied strongly, the benchmark Top 50 Index gaining 41 points to 4723.

Forsyth Barr investment adviser Anthony Tuck said the Christmas spirit was affecting investors.

"We're entering that time of the year where we get the historical Christmas rally. This time of year, markets almost always go up, all the way through to mid-January," Mr Tuck said.

"We certainly seem to be being swept up with that today."

Guocoleisure fell 1 cents to 82 cents, Chorus dropped 1-1/2 cent to $1.44-1/2 cents, while Goodman Property rose 2 cents to 98-1/2 cents and Precinct Property rose 1 cent to $1.