KEY POINTS:
The New Zealand dollar hit its lowest level in a week, dragged down by an Australian dollar that plumbed seven-month lows.
By 5pm, the kiwi eased to US69.70c from US70.50c late yesterday afternoon. Against the Aussie, it slipped to A81.11c from A81.67c.
Among domestic data today, the trade deficit widened to a worse-than-expected $781 million in July, although it was above last July's $808m.
"The trade data wasn't great but it wasn't overall the catalyst, it was part of a whole series of events," a dealer said.
A weaker Australian dollar and euro pushed the kiwi down to a session low of US69.60c.
A Reserve Bank survey today showed inflation expectations had increased, but was of limited interest to the market and had no effect on interest rates, he said.
The US dollar jumped against the Australian and New Zealand dollars as renewed jitters about the financial sector, highlighted by the ninth US bank failure this year, prompted market players to trim carry trades.
The US dollar also climbed towards a six-month high against the euro before a German survey of business sentiment, with investors seeking clues on whether the euro zone economy was hurting enough for a cut in interest rates.
British financial markets will reopen later in the day after being closed on Monday for a bank holiday.
Reuters currency rates:
5pm today 5pm yesterday
NZ dlr/US dlr US69.70c US70.50c
NZ dlr/Aust dlr A81.11c A81.67c
NZ dlr/euro 0.4737 0.4790
NZ dlr/yen 76.40 77.64
NZ dlr/stg 37.76p 38.27p
NZ TWI 65.11 65.86
Australian dollar US85.92c US86.27c
Euro/US dollar 1.4708 1.4716
US dollar/yen 109.69 110.10
- NZPA
