NZ dollar hits record high against euro

23 Jul 2012 – AAP –

The New Zealand dollar rose to record high against the euro after policymakers finally approved a €100 billion bailout for Spain’s banking sector.

The New Zealand dollar rose as a high as 65.98 euro cents, the most since the single currency entered circulation in 2002, from 65.74 cents at the close of trading in New York. It traded at 65.80 cents at 8am.

The kiwi declined to 79.70 US cents from 79.93 cents.

Eurozone finance ministers met by conference call on Friday to finally approve an agreement to provide aid to Spain.

The move did little to ease concern about Europe’s woes, with Spanish Prime Minister Mariano Rajoy forecasting a second year of recession and Valencia becoming the first region to seek a rescue from the nation’s central government.

“It is the Spanish news which sent the euro tumbling,” Stuart Ive, currency strategist at HiFX said

“Certainly it’s not good news but I don’t think it will lead to a Spanish sovereign bailout.

“The kiwi and the aussie are still holding up remarkably well,” Mr Ive said.

The New Zealand dollar was little changed at 76.90 Australian cents at 8am from 76.93 cents at the close of trading in New York.

The dropped to 62.50 yen from 62.71 yen and the trade weighted index eased to 72.34 from 72.40.