WELLINGTON (Dow Jones)--The New Zealand dollar was trading higher late Wednesday after U.S. equity markets strengthened overnight, boosting risk appetite. Westpac currency strategist Imre Speizer said this appetite had, however, waned at the end of U.S. equity trading and, without cues, the New Zealand dollar was now relatively rangebound. "They (equity markets) were strong overnight but they kind of sank in the last hour or so of trading in New York," he said. BNZ foreign exchange strategist Mike Jones added the New Zealand dollar, which chalked up most of its gains overnight, traded in a narrow range of 0.0015 during the day and appeared to be drifting lower. "It's a snooze fest. The fading strength in U.S. equities took some of the strength out of investors' risk appetite," he said. He added the market was also seeing speculative interest toward selling off in the Kiwi in favor of the Australian dollar. "It's as people continue to assess the Reserve Bank of New Zealand Official Cash Rate outlook here and that has added to the sell-off theme," he added. Speizer added he thought it was unlikely that the New Zealand dollar would break through the overnight high of US$0.7145 in the midterm. "I think this bounce (NZD/USD up from low of US$0.6999 Monday) is just a one or two day bounce and I am looking for it to get down to test 0.7000 again and then ultimately below and into those high 0.6000s," he added. New Zealand government bonds ended sharply lower following the overnight lead from U.S Treasurys, said a local bond trader. He added the Debt Management Office had announced Thursday's tenders would sell NZ$300 million total of November 2011, April 2015 and May 2021 paper, which had pushed yields higher. New Zealand interest rate swaps ended lower. -By Lucy Craymer, Dow Jones Newswires; 64-4-471-5990; lucy.craymer@dowjones.com

Source