Dollar drops below US74c mark

The New Zealand dollar fell today on a range of factors, and against a backdrop of debate amongst policymakers about how to get the currency down.

By 5pm the NZ dollar was buying US73.77c, down from US74.40c at 8am and US74.34c at 5pm yesterday.

It gained downward momentum during the afternoon several hours after Labour Party leader Phil Goff said it was time to end a 20-year political consensus on monetary policy.

The battle against inflation was no longer the most important priority - growth and wealth creation were equally vital, Mr Goff said.

Westpac currency strategist Imre Speizer said he would not attribute all of the move lower to Mr Goff.

"The aussie dollar has fallen and there are a lot of negative risk things floating around today," he said.

Wall Street closed lower and futures suggest further weakness.

Also, offshore investors had noted that New Zealand's Treasury department had put pen to paper about how to get the NZ dollar down in a report on options for Government policy.

Yields also fell in the swaps market today after a New Zealand Government bond tender was strongly bid.

Annette Beacher at TD Securities said both the Treasury paper and opposition Labour Party policy should be taken with a grain of salt.

"The opposition leader is experiencing very poor polling at the moment, hence his policy proposals have little or no chance of being enacted," she said.

The NZ dollar eased lower to 0.4946 euro at 5pm from 0.4998 at 5pm yesterday, and to 65.73 yen from 66.30.

Against the Australian dollar the kiwi was lower at A79.76c down A80.15c yesterday. The trade weighted index was 65.78 from 65.82.

- NZPA