Kiwi exploded higher after S&P revised the NZ outlook to stable, with the rating agency stating that the action reflects a sound outlook on the fiscal position, as stated in the budget. S&P warns that the main risk to ratings would be significant weakening in the credit quality of the banking sector. Kiwi, which fell to lows of 0.6120 after the budget announcement, has traded to a high of 0.6194 but remains well short of the week's high, and recent trend high, of 0.6262. A broadly stronger USD is seen hampering NZD gains, with offers tipped around 0.6200.
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