By Paul McBeth
The New Zealand dollar gained as dairy futures indicated global dairy prices may have found a base, easing pressure on the Reserve Bank to cut interest rates in response to a slump in the country's biggest export.
The kiwi rose to 65.78 US cents at 5pm in Wellington from 65.34 cents at 8am and 65.24 cents yesterday. The trade-weighted index advanced to 71.30 from 71.02 today.
Dairy futures pricing has been pointing a rise in milk product prices after recent declines at the GlobalDairyTrade auction.
Fonterra chairman John Wilson today told shareholders the world's biggest dairy exporter anticipates prices to rise early next year, which it needs to meet its earnings and payout forecasts.
"I don't want to jump the gun, but it looks like we may see dairy prices continue to stabilise," said Stuart Ive, senior dealer foreign exchange at OMF in Wellington.
The week is disrupted by the US Thanksgiving Day holiday tomorrow, where US markets will be closed, and some market participants take the Friday off as well.
Investors are firming up their bets the Federal Open Market Committee will hike rates when it next reviews policy in December, with next week's November non-farm payrolls the last major piece of data before the Federal Reserve's meeting.
The local currency fell to 90.41 Australian cents from 90.62 cents yesterday after Reserve Bank of Australia governor Glenn Stevens talked down the prospect for another rate cut.
The kiwi climbed to 4.2019 Chinese yuan from 4.1681 yuan, and rose to 80.46 yen from 80.08 yen. It increased to 61.62 euro cents from 61.34 cents, and gained to 43.54 British pence from 43.10 pence.
New Zealand's two-year swap rate was unchanged at 2.7 percent at 5pm in Wellington, and the 10-year swap fell one basis point to 3.57 percent.