WELLINGTON (Dow Jones)--The New Zealand dollar was stronger late Monday but remained largely rangebound, as the market digested news of Friday's devastating earthquake and tsunami in Japan. "We are just in a consolidation phase. No one knows if this Japanese situation is going to escalate any further than it already has. There are obviously many uncertainties and in the meantime the kiwi probably won't drift too far off its recent ranges," said HiFX Senior Trader Stuart Ive. "It is really the only story today," he said, adding that the market is keeping a close eye on nuclear reactors in Japan and any statement from the Bank of Japan's policy board meeting Monday. Ive tipped support for the local unit at US$0.7320-30 and resistance at around US$0.7460. Bank of New Zealand FX Strategist Mike Jones said "gyrations in global risk appetite will dictate the fortunes of the NZ dollar this week." He said the market will be focused on the Japanese government's response to the disaster, but eyes will also be on a slew of U.S. economic data and the Federal Open Market Committee's policy announcement later in the week. New Zealand government bonds ended stronger, while swap rates pushed lower. A local bond trader said uncertainty around the potential impact of the natural disaster in Japan has led investors to turn to bonds, while swap rates fell as the market continued to push out expectations of when the Reserve Bank of New Zealand might move to hike the Official Cash Rate. Swap rates have moved lower since last Thursday when the Reserve Bank of New Zealand cut the Official Cash Rate by 50 basis points to 2.50% to offset the impact from the earthquake that devastated the nation's second-largest city of Christchurch last month. -By Rebecca Howard, Dow Jones Newswires; 64-4-471-5990; rebecca.howard@dowjones.com

Source