FX options indicate big euro/dollar swings may pause

imageLONDON: Recent sharp swings in the euro/dollar exchange rate have not been matched by moves in the currency options market, as a cautious outlook from the U.S. Federal Reserve pushes back expectations of when rates will rise.

The euro, which hit a 12-year low of $ 1.04570 the day before the Fed meeting began, jumped to a high of $ 1.10625 in the hours after Fed Chair Janet Yellen hinted on March 18 that interest rates would not be raised in a hurry.

It was the biggest one-day percentage jump in euro/dollar in six years and was followed a day later by its second-biggest fall since November 2011.

But in the options market, one-month euro/dollar implied volatility, a gauge of how sharp swings will be in the pair and used by investors to hedge exposure, has fallen towards levels last seen before the Federal Reserve’s March 17-18 meeting.

It was at around 11.4 percent on Wednesday, down from 13 percent on Monday and 12.7 on March 16.

“The more accommodative Fed policy stance means more liquidity and that should see the short end of the implied volatility curve head lower,” said Adam Myers, European head of FX strategy at Credit Agricole.

“At the same time, chances that the Fed could start tightening in September will keep a bid at the longer end.”

This suggests euro/dollar may enter a period of range-bound trading before resuming its trek lower.

Fed policymakers lowered their median estimate for the federal funds rate — the so-called “dot plot” — and sent a more dovish message than many were expecting. Investors pushed back expectations for a rate hike to September from June.

Yellen also flagged some discomfiture about the dollar’s strength and its impact on U.S. inflation.

That triggered a sell-off in the dollar, which has lost 3.5 percent since hitting a 12-year high of 100.39 against a basket of currencies on March 13.

The euro, which many still expect to drop towards parity with the dollar in coming months as the European Central Bank unleashes its asset-buying programme, has stabilised just below $ 1.10 as investors trim bets against it.

Traders said that unless the euro drops below $ 1.08 or sustains gains above $ 1.10, demand for short-dated options to hedge against sharp moves will be low.

“After such a huge risk event like the Fed, it is but natural for short dated implied vols to come off,” said a chief options trader at a European bank. “It could go down a bit more before stabilising.”

Analysts said the uncertainty about the Fed rate outlook would support implied longer-dated volatilities, especially those maturing in September and later.

“The stage is set for a noisy run-in to mid-year lift-off amid poor and possibly deteriorating liquidity,” JPMorgan’s Arindam Sandilya wrote in a note.

Copyright Reuters, 2015

Euro softness offers timely boost for UAE retail, trade

There could be slight time lag before exchange rate benefits show up in local pricing

The euro’s current spell of weakness — and expectations that it could drop even further — should translate into lower priced goods in the UAE’s retail sector… but just not yet. Local consumers hoping to get better deals on branded apparel from Eurozone labels or waiting to stock up on Danish butter or French sauces will need to wait a bit longer.

“There is a time lag accessing lower import costs from the euro’s softness to those being mirrored in merchandise prices at the shops,” said V. Nandakumar, group communications officer at the Lulu Group. “We are talking about it happening in a few weeks and not taking months — the benefits will eventually be reflected in the amounts shoppers pay at the till.”

The group currently sources around 20 per cent of its inventory — mostly in the food category — for its Lulu hypermarkets from the Eurozone.

But some retailers, especially those handling fashion brands, have been quick to try and take advantage of the currency situation. Working in tandem with the brand principals, they have launched perfectly timed promotions, or plan to do so shortly, to clear up stocks and build up demand for new season’s lines.

The UAE’s retail sector will take all sorts of help in trying to win back momentum after a less-than-stellar fourth quarter and an indifferent first-quarter performance. Sales turnover on select categories were high during the DSF 2015, but February and March were quite subdued.

If spending by tourists does not reach the highs of the last three years, retailers will need domestic shoppers to turn up more frequently at the shops and keep spending more.

This is where a weak euro can be a great help. It can help prompt shoppers to go for those discretionary spending on euro-based good they would have deemed to be expensive earlier. How well retailers are able to manage those sentiments will thus be the key.

It could also set off an onrush among mid-tier Eurozone brands — those that haven’t done so already — trying to get into the Middle East’s retail space. For them, it is not just another expansion move but one that’s vital to their existence.

“Given the on-going challenges in the Eurozone, retailers are likely to be looking further afield for their future growth and in order to meet with store rollout targets,” said Mat Green, head of Research and Consultancy UAE at CBRE M. E. “The Middle East is likely to be high on the list of potential locations, particularly Dubai and Abu Dhabi, which continue to attract a growing number of international brands.”

But for those UAE companies selling into Eurozone, having adequate safeguards on their exposures would not go amiss.

“Coface is receiving an increased number of enquiries to cover trade between the region [Eurozone] and the GCC countries over the past two months, as companies aim to protect their receivables from the threats of payment defaults,” said Massimo Falcioni, head of Middle East Countries at Coface, the credit insurance firm.

“The number of insolvencies [in Eurozone] is well above the period before the 2008 crises due to low capitalisation, [a] heavy fiscal burden, high labour costs and [the] impact of bureaucracy. The risk of non-payments and payments delays is still moderate to high.”

© Al Nisr Publishing LLC 2015. All rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

Expat rates: fixed savings suffer from base rate doldrums

Banks have been cutting the rates on their euro-denominated accounts

Base rate is now in its seventh year at 0.5pc and shows no sign of rising, making life as difficult as ever for savers.

But at least they can stop worrying that base rate has further to fall. Mark Carney, Governor of the Bank of England, said last week that it would be “extremely foolish” for the bank to cut rates further to try to combat low inflation caused by the fall in oil prices.

However, there is still no sight of a rise in base rate this year experts are pencilling one in for 2016 at the earliest.

As a result, some expat fixed savings rates have dropped. Permanent International ( permanent-bank.com ) has cut rates on its one-, two-, three- and five-year fixed rates as well as reducing rates on its less than one-year deals, but only for euro-denominated accounts. It has also launched new issues of its 15-month and 18-month fixed deals, but at lower rates than before.

The biggest cuts at Permanent affect its two-, three- and five-year fixed rates. It was paying 2.03pc fixed for two years but is now paying 1.69pc. For three years, before March 16 Permanent was paying 2.06pc but for new savers now the rate is 1.67pc. And for five years, Permanent was paying 2.11pc: now the rate is 1.64pc.

Permanent’s euro-denominated fixed rates have all been cut; they now go from 0.2pc fixed for three months on a minimum £100,000 (previously 0.4pc) to 0.79pc fixed for five years (before it was 1.17pc) on £20,000 plus.

The new issues of its 15-month and 18-month fixed deals are 1.6pc and 1.7pc respectively the previous issues paid 1.7pc and 1.85pc.

Santander both its Isle of Man branch ( santander.co.im ) and its Channel Islands-based private bank ( santanderpb.je ) has cut rates on its one- and two-year fixed rates and has withdrawn its three-year fixed rate deal.

Santander was offering 1.1-1.2pc as a one year fixed rate and now is paying 1-1.1pc. The two-year rate was 1.4-1.5pc and is now 1.25-1.35pc. The three-year deal, yet to be replaced, was 1.75-1.8pc. For both deals, the lower rate is paid on £500-£199,999 with Santander’s Isle of Man branch and £50,000-£199,000 with the private bank.

Even after the cuts, the two-year Santander deals are competitive although beaten by the reduced Permanent two-year fixed deal at 1.69pc. The Santander one-year deal of 1-1.1pc is beaten by at least three other providers with the top rate 1.45pc offered by Nationwide International ( nationwideinternational.com ).

These changes make the recently-launched three-year fixed rate of 2.2pc from Skipton International not five years, as mistakenly stated in the previous Expat Rates column look particularly good for those wanting certainty for a longer time period ( skiptoninternational.com ).

Even if base rate starts to go up next year, it is unlikely to climb dramatically, so it is reasonable to expect the Skipton deal to remain competitive in the future.

No early access to the money in the bond is allowed, so do not put your money in unless you will not need to get at it earlier.

• Britannia International has now completed its closure procedure. Last year the Isle of Man based bank announced it was to shut as its parent bank, Co-operative, decided to concentrate on its home market by closing it.

It has now written to the few remaining customers who have not moved their money away telling them their accounts have been closed.

Any remaining balances have been moved into a segregated account scheme, which will become effective on March 17. If you do have money that is now being moved into the segregated account, you need to contact the scheme administrator, Appleby Trust (Isle of Man) Limited, 33-37 Athol Street, Douglas, Isle of Man IM1 1LB.

Euro gains vs dollar as traders eye Fed for interest rate clues

imageLONDON: The euro rose for a second day against the dollar on Tuesday as investors awaited the start of a two-day US Federal Reserve policy meeting that will test expectations of a mid-2015 rise in US interest rates.

The single currency had come under pressure after the European Central Bank began a bond-buying programme last week that will pump more than one trillion euros of newly created money into the euro zone economy.

But the euro won some relief on Monday after weaker-than-expected US manufacturing, industrial output and housing data pushed down US debt yields and cooled the dollar’s advance.

The US currency’s surge since early March has been driven by solidifying expectations that the Fed’s Open Market Committee (FOMC) will point towards a June rate rise by dropping a pledge to be “patient”.

The dollar has gained around 20 percent against a basket of major currencies over the past six months and some investors speculate that the Fed cannot ignore how much that rise reduces pressure on inflation.

Derek Halpenny, European head of global markets research at Bank of Tokyo-Mitsubishi UFJ in London, reckoned the removal of the word “patient” was “pretty much a done deal”, but that investors were nevertheless eager to take risk off their books ahead of the Fed meeting.

“There are so many other angles that (Fed Chair Janet) Yellen could go at to paint a picture of caution and the potential for the first move to be beyond June,” he said.

“If you’ve been short euro over the past week, you’ve had a good week, and why would you bother running the risk into what is a difficult event to predict?” Having hit a 12-year low of $ 1.0457 at the start of the week, the euro was up 0.2 percent at $ 1.0589 on Tuesday morning. The dollar was around 0.1 percent lower against a basket of major currencies.

Traders will also keep an eye on how other asset markets react to the Fed’s statement and comments from Yellen after the meeting.

“The main point is how Treasury yields respond to the Fed. Despite the removal of “patience”, prospects of a September, rather than June, rate hike may linger, given the dollar’s appreciation and lower oil prices,” said a currency trader at a large Japanese bank.

The dollar inched up 0.1 percent to 121.42 yen, stuck in a relatively narrow range since advancing to an eight-year high of 122.04 on March 10.

The Bank of Japan concluded its two-day policy meeting on Tuesday, at which the central bank stood pat on monetary policy and maintained its massive stimulus. Market reaction was limited because the outcome was as expected.

Copyright Reuters, 2015
UK-MARKETS-GLOBAL:Asian shares rise on bets Fed may stay cautious
A pedestrian is reflected in an electronic board showing the graph of the recent fluctuations of Japan’s Nikkei average outside a brokerage in Tokyo March 13, 2015. REUTERS/Yuya Shino

By Ryan Vlastelica

NEW YORK (Reuters) – Stocks mostly fell on Tuesday as the Federal Reserve opened a two-day policy meeting, which is being closely watched for signs of when the U.S. central bank will raise interest rates.

Trading was volatile in other asset classes. Crude oil prices edged lower and remained on track for their eighth decline in the past nine sessions, but were well off lows of the day. The U.S. dollar index turned flat, rebounding off earlier weakness.

The euro , which recently hit a 12-year low, rose against the dollar for a second straight session, though it was off its session peak.

European equity markets retreated from gains built on the euro’s decline, which cheapens the price of exports from the euro zone. London’s market <.ftse> was an exception, and Asian markets ended higher.

U.S. crude oil hit a six-year low of $ 42.63 a barrel before paring losses to trade down 0.2 percent, at $ 43.79. The recent weakness has come on oversupply and the possibility that a nuclear agreement with Iran could add to the glut.

Brent crude fell 1.3 percent to $ 53.22 per barrel.

Investors were awaiting the release of the Fed’s policy statement on Wednesday afternoon. Many analysts expect the Fed to remove the word “patient” from its statement to describe its approach to raising rates later in the year. Doing so would put the Fed a step closer to its first rate hike since 2006.

Economists polled by Reuters are almost evenly split on whether a rate increase will come in June or later in the year. Recent U.S. data, including Tuesday’s on February housing starts, has fuelled talk that the Fed will remain on hold as long as possible.

“A lot of today’s decline is speculation on how the Fed will respond, along with the sense that (U.S.) growth is weak,” said Bruce McCain, chief investment strategist at Key Private Bank in Cleveland.

The Dow Jones industrial average <.dji> fell 137.69 points, or 0.77 percent, to 17,839.73, the S&P 500 <.spx> lost 9.54 points, or 0.46 percent, to 2,071.65, and the Nasdaq Composite <.ixic> dropped 4.05 points, or 0.08 percent, to 4,925.46.

The MSCI International ACWI price index <.miwd00000pus> slipped 0.2 percent while European shares <.fteu3> ended 0.7 percent lower, a day after hitting a 7-1/2-year high.

The benchmark 10-year U.S. Treasury note rose 11/32 in price, pushing the yield down to 2.0594 percent.

The euro rose 0.2 percent to $ 1.0592, having earlier risen as much as 0.8 percent. Earlier this week, the euro dropped to a 12-year low of $ 1.0457 .

The U.S. dollar index, which measures the greenback against a basket of major currencies, was flat at 99.612. On Monday, the index posted its biggest drop in more than a month.

Gold prices fell 0.4 percent while silver was down 0.4 percent. Copper lost 1 percent in its second straight daily decline.

(Editing by Dan Grebler and Leslie Adler)

Reuters

FOREX-Euro gains vs dollar as traders eye Fed for interest rate clues

* Euro gains against dollar for second straight day

* Traders taking risk off table ahead of Fed policy meeting

* BOJ stands pat on policy as expected, market reaction limited

By Jemima Kelly

LONDON, March 17 (Reuters) – The euro rose for a second day against the dollar on Tuesday as investors awaited the start of a two-day U.S. Federal Reserve policy meeting that will test expectations of a mid-2015 rise in U.S. interest rates.

The single currency had come under pressure after the European Central Bank began a bond-buying programme last week that will pump more than one trillion euros of newly created money into the euro zone economy.

But the euro won some relief on Monday after weaker-than-expected U.S. manufacturing, industrial output and housing data pushed down U.S. debt yields and cooled the dollar’s advance.

The U.S. currency’s surge since early March has been driven by solidifying expectations that the Fed’s Open Market Committee (FOMC) will point towards a June rate rise by dropping a pledge to be “patient”.

The dollar has gained around 20 percent against a basket of major currencies over the past six months and some investors speculate that the Fed cannot ignore how much that rise reduces pressure on inflation.

Derek Halpenny, European head of global markets research at Bank of Tokyo-Mitsubishi UFJ in London, reckoned the removal of the word “patient” was “pretty much a done deal”, but that investors were nevertheless eager to take risk off their books ahead of the Fed meeting.

“There are so many other angles that (Fed Chair Janet) Yellen could go at to paint a picture of caution and the potential for the first move to be beyond June,” he said.

“If you’ve been short euro over the past week, you’ve had a good week, and why would you bother running the risk into what is a difficult event to predict?”

Having hit a 12-year low of $ 1.0457 at the start of the week, the euro was up 0.2 percent at $ 1.0589 on Tuesday morning. The dollar was around 0.1 percent lower against a basket of major currencies.

Traders will also keep an eye on how other asset markets react to the Fed’s statement and comments from Yellen after the meeting.

“The main point is how Treasury yields respond to the Fed. Despite the removal of “patience”, prospects of a September, rather than June, rate hike may linger, given the dollar’s appreciation and lower oil prices,” said a currency trader at a large Japanese bank.

The dollar inched up 0.1 percent to 121.42 yen, stuck in a relatively narrow range since advancing to an eight-year high of 122.04 on March 10.

The Bank of Japan concluded its two-day policy meeting on Tuesday, at which the central bank stood pat on monetary policy and maintained its massive stimulus. Market reaction was limited because the outcome was as expected.

(Additional reporting by Shinichi Saoshiro in Tokyo; Editing by Gareth Jones)

Another week, another euro fall

The plunge in the euro may be starting to look overstretched, but that’s unlikely to stop traders from pushing the battered single currency even lower this week, analysts warned.

The euro briefly fell to a fresh 12-year low against the dollar Monday, at about $ 1.0457, before recovering a touch. Last week, the currency slid 3.2 percent — its biggest weekly fall since 2011 — as the European Central Bank embarked on a 1-trillion-euro quantitative easing program and talk of a rate rise by the U.S. Federal Reserve this year grew.

“The euro continues to track lower and while it continues to struggle above the $ 1.0600 level, the prospect of a move to parity remains very much a possibility,” Michael Hewson, chief market analyst at CMC Markets, said in a note.

“The move lower continues to get more and more overextended, yet new lows continue to be hit every day.”

Read More Weak euro, ECB stimulus make Europe a solid bet: Wisdom Tree

Premarket: Weak euro powers European stocks to new highs

The euro struck a fresh 12-year low on Monday and euro zone stocks reached new peaks on bets that the currency’s relentless fall will boost corporate earning prospects just as the rising dollar hits those of U.S. firms.

German stocks powered above 12,000 points for the first time, while the main pan-euro zone benchmark indices hit new seven-year highs.

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The euro rebounded as European trading got under way, however, while U.S. oil prices recovered after slipping to a fresh six-year low, although they were still down on the day.

This week’s focal point for global financial markets is the U.S. Federal Reserve’s policy decision on Wednesday, with the euro/dollar exchange rate likely to remain the dominant driver for major equity, currency and bond markets until then.

“With dollar momentum this strong and investors unlikely to ride any euro rally ahead of the (Fed) meeting, risks for the euro are still to the downside for the next couple of days and any bounces are likely to be limited,” Unicredit FX analysts said on Monday.

In early European trading the euro was up 1/3 of a per cent against the dollar at $ 1.0530, having slid to $ 1.0457 early in the Asian session, its lowest since January 2003.

The euro has lost roughly a quarter of its value versus the dollar since mid-2014 and suffered its biggest weekly fall since September 2011 last week, shedding 3.2 per cent as the European Central Bank launched its trillion euro money-printing scheme.

Goldman Sachs now sees the euro at $ 0.80 by the end of 2017.

European stocks took heart. Germany’s DAX was up 0.85 per cent at 12,001 points, France’s CAC 40 half a per cent higher at 5,039 points, and Britain’s FTSE 100 index up 0.25 per cent at 6,758 points.

The FTSEurofirst 300 index of top European shares rose 0.3 per cent to 1,584 points and the euro zone top 50 stocks index was up 0.5 per cent at a seven-year high of 3,673 points.

MSCI’s broadest index of Asia-Pacific shares outside Japan closed a few ticks higher, while Chinese shares outperformed to hit five-year-highs.

The CSI300 index and the Shanghai Composite Index both rose more than 2 per cent after Premier Li Keqiang said Beijing had scope to adjust policies to help boost the world’s second largest economy.

Japan’s Nikkei hit a 15-year high of 19,349 points Recent weak U.S. inflation and retail sales data have not derailed expectations that the Fed will tighten monetary policy, and the prospects that higher rates and a stronger dollar will hit U.S. corporate profits have dragged on shares.

Wall Street futures were seen opening 0.2 per cent higher on Monday, lagging Europe’s main bourses.

Many observers expect the Fed to remove its pledge to remain “patient” on delivering its first interest rate hike since 2006, with economists polled by Reuters almost evenly split on whether a first hike will come in June or later in the year.

German 10-year Bund yields inched up 1 basis point to 0.265 per cent, having hit a record-low 0.188 per cent last week. Longer-dated German yields fell, however, and benchmark Spanish, Italian and Portuguese yields were also headed back towards their recent record lows.

The ECB is expected to buy more sovereign bonds as part of its stimulus program this week, limiting any upward pressure on bond yields.

“The current dynamic is incredible, logical and extendable … until something changes, but there is little sign of that right now,” Citi rates strategist Mark Schofield said.

Oil prices continued to tumble, with U.S. crude dropping more than 2 per cent at one point to a six-year low on fears of oversupply. The International Energy Agency said on Friday that a global glut of oil is growing and U.S. production shows no sign of slowing.

U.S. crude was last down about 0.8 per cent at $ 44.48 a barrel, while Brent was 0.6 per cent lower at $ 54.32.

After snapping its longest daily losing streak since 1973 on Friday with a first rise in 10 sessions, gold consolidated its gains. Bullion was flat on the day at $ 1,158 an ounce.

Another week, another euro drubbing

The plunge in the euro may be starting to look overstretched, but that’s unlikely to stop traders from pushing the battered single currency even lower this week, analysts warned.

The euro (Unknown: EURBA=) briefly fell to a fresh 12-year low against the dollar Monday, at about $ 1.0457, before recovering a touch. Last week, the currency slid 3.2 percent — its biggest weekly fall since 2011 — as the European Central Bank embarked on a 1-trillion-euro quantitative easing program and talk of a rate rise by the U.S. Federal Reserve this year grew.

“The euro continues to track lower and while it continues to struggle above the $ 1.0600 level, the prospect of a move to parity remains very much a possibility,” Michael Hewson, chief market analyst at CMC Markets, said in a note.

“The move lower continues to get more and more overextended, yet new lows continue to be hit every day.”

Read More Weak euro, ECB stimulus make Europe a solid bet: Wisdom Tree

Market positioning data from the Commodity Futures Trading Commission on Friday showed that long dollar (New York Board of Trade (Futures): =USD) bets, which reflect the view that the greenback will strengthen, rose to their highest level in four weeks in the week ended March 10.

The value of the dollar’s net long position was $ 44.31 billion that week, compared with $ 40.85 billion the week before. It marked the eleventh straight week that long positions on the greenback have been in the $ 40-billion region.

Michael Every, head of financial markets research for Asia-Pacific at Rabobank, told CNBC Asia’s “Squawk Box” that the euro could hit parity, or one-to-one against the dollar, within a matter of trading sessions.

“We’ve seen an incredible swing towards the dollar and away from the euro, and if we do get the removal of the word ‘patience’ from the Fed on Wednesday and weak euro zone data we could get there (parity) in a week,” he said.

Read More It’s all about the Fed, but watch for these flareups

Every was referring to this week’s Federal Reserve meeting and speculation that the central bank could remove the word “patience” from its guidance about the pace at which it will normalize monetary policy. If it does, it could signify that rates could rise this year.

Saktiandi Supaat, head of global FX strategy at Maybank, told CNBC that the euro could test resistance levels of $ 1.02 over the next week, which would imply a further loss of 3 percent from current levels. The euro has tumbled almost 25 percent over the past year.

Some analysts said that even if the Fed does not use the word “patience” this week, it could still signal that a rate rise as early as June may not be on the cards – something that could knock the resurgent dollar and give the euro a lift.

“The euro is oversold at these levels and this is a good week for a bounce. I think the Fed will be cautious and temper expectations for a rate rise in June,” Boris Schlossberg, managing director of FX strategy at BK Asset Management in New York, told CNBC Europe.

“The Fed is the only major central bank looking to tighten and it is hard to do that when most central banks are still easing,” he added. “I think the markets are getting a bit ahead of themselves in terms of dollar strength.”

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Kiwi hits high against euro, more to come

The New Zealand dollar has reached its highest level ever against the euro in what may be the first of more peaks as the euro falls foul of the European Central Bank’s bond-buying programme.

The kiwi hit a record 70 euro cents on Monday morning, and was trading at 69.96c at 5pm on Monday in Wellington from 69.47 cents at 5pm on Friday. The local currency rose to US73.64 cents from US73.39c at the New York close on Friday.

Sam Tuck, senior FX strategist at ANZ New Zealand, says the kiwi may dip on this week’s GlobalDairyTrade dairy auction as he’s picking prices will be weak but there will be a reminder of the strength of the New Zealand economy when fourth quarter gross domestic product figures are released on Thursday.

The report is expected to show the New Zealand’s economy expanded at a 0.7 per cent pace in the fourth quarter, for an annual average growth rate of 3.2 per cent, according to a Reuters poll.

The US dollar is at its highest level in 12 years amid speculation the Federal Reserve Open Market Committee will drop the word “patient” from its policy statement at 7am Thursday New Zealand time, suggesting the Fed is getting close to lifting its benchmark interest rate which has been near zero since 2008.

That leaves the euro out of favour for as the European Central Bank buys 60 billion euros worth of bonds per month it pushes bond yields lower and investors look offshore for returns, weakening the euro.

“This morning we got above 70.00 euro cents and our expectation is the euro will continue to decline over 2015. Our forecasts expect kiwi-euro to get to 73 to 74 by the end of the year,” Mr Tuck said.

On Monday, the New Zealand dollar gained to 96.23 Australian cents from A95.99c on Friday.

The local currency was at 49.86 British pence from 49.58 pence on Friday and 89.29 yen from 89.58 yen.

The trade-weighted index rose to 77.95 from 77.87.