Currency: Dollar closes at US50c

The New Zealand dollar took a hit late in its domestic day from Chinese trade data.

It not a typical catalyst for the local currency market but news that China's exports fell 25.7 per cent in February from a year earlier hurt all currencies perceived to be risky.

Imre Speizer, senior market strategist at Westpac, said the export number was expected to improve but it instead weakened.

Given China is seen as a key player in any global economic recovery a bad economic statistic from it increased risk aversion.

The NZ dollar was trading around US50.40c before the Chinese trade data and it quickly fell to be US50.00c at 5pm. That compared to US49.76c at the same time yesterday.

Dealers said there was little reaction to the New Zealand terms of trade data today.

New Zealand's terms of trade fell a smaller than expected 0.9 per cent in the December quarter, as import prices rose more than export prices.

The market has a big day tomorrow with the Reserve Bank of New Zealand's monetary policy statement at 9am.

Economists were expecting a 100 basis point cut in the 3.5 per cent official cash rate but in recent weeks that has reduced to between 50 and 75 basis points.

Stock markets in Asia were higher today, which helped sentiment.

Against the Australian dollar, the kiwi was at A77.75c, little changed from A77.90c yesterday.

The NZ dollar rose to 0.3950 euros from 0.3925 yesterday, and was little changed against the yen, at 49.25 from 49.22. The trade weighted index was 51.73 from 51.51.

- NZPA