Currency: Dollar falls on investor concerns

The New Zealand dollar fell to its lowest level in a week and a half against the greenback as persistent worries about world economic prospects led to rises in the United States and Japanese currencies.

By 5pm today the NZ dollar was buying US58.60c from US58.42c at 8am and US59.30c at 5pm on Friday. Dealers said the low today was US58.35c.

The NZ dollar fell to a fortnight-low against the Japanese currency, and was 55.55 yen by the local close from 56.85 yen on Friday.

Investors were risk averse again and seeking safer investments after the European Union's statistics agency reported that the 16 nation euro-zone posted its bleakest economic performance since it came into being in 1999.

The euro-zone economy shrank 2.5 per cent in the first quarter from the previous quarter and 4.6 per cent from the same period a year ago, driven by a plunge in German output.

In New Zealand, the March quarter Producers Price Index showed big falls in input and output prices, catching economists by surprise, and suggesting inflation was not a problem.

Input prices fell 2.5 per cent in the three month period, the largest decline since the series began in 1977. Output prices fell 1.4 per cent.

"As for the rest of this week, with the absence of any major domestic data releases, New Zealand markets will no doubt be influenced most by global goings on," BNZ said.

The NZ dollar was little changed at 0.4360 euro by 5pm from 0.4346 on Friday, and against the Australian dollar was A78.30c from A78.05c. The trade weighted index was 57.05 from 57.38 on Friday.

Currency rates:

5pm today 5pm Friday

NZ dlr/US dlr US58.60c US59.30c

NZ dlr/Aust dlr A78.30c A78.05c

NZ dlr/euro 0.4360 0.4346

NZ dlr/yen 55.55 56.85

NZ dlr/stg 38.66p 38.92p

NZ TWI 57.05 57.38

Aust dlr/US dlr 74.86c 75.92c

Euro/US dlr 1.3448 1.3637

US dlr/yen 94.80 95.92

- NZPA