The New Zealand dollar fell as investors took shelter in the greenback and yen amid concerns Washington's bank rescue plan will not revive the ailing financial sector.
After climbing to a three-week high above US54.40c early yesterday, the kiwi was down to US52.32c by 8am today from US53.14cat 5pm yesterday. It closed today at US52.37c.
"It is back to Dow-watching for the NZ dollar, which was hammered again," said ANZ in a briefing.
Markets had pinned their hopes on the US bank rescue package, aimed at helping banks offload "toxic assets" and boost capital, but it has failed to reinvigorate a sagging US equities market, leading to buying in the US dollar and the Japanese currency.
Equity markets in Asia were also weak today.
Investors also took little comfort in a US Senate vote that passed an economic rescue plan, while also setting the stage for tough negotiations over the final size and scope of spending and tax cuts aimed at reversing the deep recession.
Against the yen, the NZ dollar was down to 47.33 by the local close from 48.62 yesterday, with the kiwi also down to 0.4066 euro from 0.4145 yesterday.
The kiwi did strengthen against the Australian dollar to A80.10c at the local open from A79.54c yesterday evening and it was A80.05c at 5pm today.
The trade weighted index was 52.81 from 53.36 yesterday.
