New Zealand dollar nears parity with Aussie

OH GOD. It’s finally happening. The Kiwis have been nipping at our heels for a while, and news out this morning could finally push them over the edge.

BRISBANE, AUSTRALIA - AUGUST 27: Brad Thorn of the All Blacks is tackeld by Pat McCabe of the Wallabies during the Tri-Nations Bledisloe Cup match between the Australian Wallabies and the New Zealand All Blacks at Suncorp Stadium on August 27, 2011 in Brisbane, Australia. (Photo by Phil Walter/Getty Images)

THE New Zealand dollar has traded close to parity with the Australian dollar amid speculation weak Australian inflation data could push it through the historic milestone.

The kiwi touched a record against the euro on concern about whether Greece will exit the common currency.

The kiwi hit 99.59 Australian cents overnight and was trading at 99.51 cents at 8am in Wellington, from 99.35 cents at 5pm on Tuesday. The local currency touched a fresh record of 72.02 euro cents and was trading at 71.42 cents at 8am from 71.28 cents. It advanced to 76.65 US cents from 76.51 cents.

Traders have increased their bets that the Reserve Bank of Australia will cut interest rates at its meeting next month after governor Glenn Stevens, who kept the cash rate unchanged at 2.25 per cent last month, said that further cuts were still “on the table”.

A report out on Wednesday is expected to show the Australian consumers price index rose 0.2 per cent in the first quarter for an annual rate of 1.3 per cent, according to a Reuters survey.

“A push for parity remains on the cards,” ANZ Bank said. “Weak Australia CPI figures today could see the parity corks popped.”

The local currency touched a fresh high against the euro amid mounting concerns that Greece may exit the common currency as it fails to make progress in reaching agreement on its debt repayments.

The kiwi touched a three month high of 51.79 British pence, and was trading at 51.39 pence at 8am from 51.37 pence.

It also touched a three month high of 92.10 yen, and was trading at 91.75 yen at 8am from 91.34 yen.

The trade-weighted index, the broad measure of the currency favoured by the Reserve Bank, touched 80.53, its highest level since July last year when it hit a record 82.03. The TWI was at 80.17 at 8am from 80.04.

Originally published as New Zealand dollar nears parity with Aussie