Late Change NZD/USD 0.7728 +0.0057 NZD/AUD 0.7594 -0.0001 NZD/JPY 59.9955 +0.426 April 2013 Bond 2.43% +1.0 bps May 2021 Bond 3.915% +1.0 bps 10-Year U.S. Spread +186 bps -5.0 bps 90-Day Bank Bill 2.69% unchanged WELLINGTON (Dow Jones)--The New Zealand dollar was trading higher against the U.S. dollar late Monday after European leaders reached an agreement on tougher fiscal rules for the euro-zone nations late Friday, although the currency remained largely rangebound as markets awaited further detail. The Kiwi stuck to a tight range "as the market waits to see what is actually happening in the euro zone," ANZ Foreign Exchange Manager Murray Hindley said. ANZ noted that while the market initially reacted positively to Friday's events in Europe, "question marks" are now starting to emerge. "There were few new resources, the proposed fiscal treaty faces hurdles, it does not address solvency challenges, and in the meantime the growth portrait across Europe will continue to suffer the longer it takes to strike a bazooka-style deal," it said. A tone of "disappointment" was likely to dominate foreign exchange markets over the week, it added. Hindley noted that trading Monday was light throughout the session. "We are starting to get into Christmas markets. Liquidity is thin but there hasn't really been much interest out of Asia today," he said. He said a lack of local drivers means that investors will remain closely focused on offshore markets for direction, with interest centering on U.S. retail sales data later in the week and the U.S. FOMC decision, as well as data out of Europe. He put short-term support for the New Zealand dollar around US$0.7720, with resistance at US$0.7760. Government bonds ended slightly higher as some progress has been made in Europe, a local bond trader said. "There is a little bit of a risk-on theme," he said. He noted, however, "there is lots to be done, so rates haven't really raced away." -By Rebecca Howard, Dow Jones Newswires; +64-4-471-5990; rebecca.howard@dowjones.com

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