By LUCY CRAYMER WELLINGTON—The New Zealand dollar came under pressure Tuesday after a wider-than-expected trade deficit in October but bounced back to trade just slightly lower against the U.S. dollar, as investors welcomed a EU finance ministers' decision to disburse bailout funds to Greece. Euro-zone finance ministers agreed a mix of measures that included an extension of loan maturities, a cut to the interest rates Greece pays on loans and a debt buyback. The combined measures are expected to reduce Greece's debt to "substantially lower" than 110% of GDP in 2022. Westpac currency strategist Imre Speizer said the New Zealand dollar had reached a 24-hour high of US$0.8239 following the news but he expected further moves higher to happen during the London session. At 0440 GMT, the New Zealand dollar was trading at US$0.8235, slightly lower from US$0.8241 late Monday. The local currency was buying 0.7853 Australian dollars compared with A$0.7856 Monday. A wider-than-expected trade deficit weighed on the local currency. Statistics New Zealand said the October trade deficit narrowed to 718 million New Zealand dollars (US$590 million) from a revised NZ$775 million in September. But the figure was much wider than the median expectation from a Wall Street Journal survey of 11 economists, which was for a NZ$450 million deficit. Meanwhile, inflation expectations for the next 24 months, a key focus for policy makers, eased very slightly to 2.27% from 2.32% in the previous survey, data from the Reserve Bank of New Zealand showed. Westpac's Mr. Speizer said he was surprised that while the inflation report was positive it had little impact on the market. The April 2015 bond ended unchanged at 2.49%, while the April 2023 bond was up two basis points at 3.525%. A local trader said that the markets remain very quiet, even with positive Greek headlines out of Europe.

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