Kiwi dollar slips against greenback

The New Zealand dollar slipped against currencies of the United States and Japan, as the greenback strengthened after a report showing US consumer confidence deteriorated sharply in October.

The kiwi was this morning buying US74.53c from US74.76c at 5pm, and was down to 68.41 yen from 68.85.

The deterioration in US consumer confidence boosted the greenback's safe-haven appeal.

"When the US consumer is not likely to continue spending, it means it's going to be a long, drawn-out type of recovery. Nothing is going to happen overnight," said Dan Cook, senior market analyst at IG Markets in Chicago. "So we see that drive to risk aversion."

Other recent US economic figures, such as weekly jobless claims, have not met the market's expectations, raising doubts about the health of the US economy.

"The market is beginning to realise that the recovery scenario priced into the current levels of risk assets may be overly optimistic," said Boris Schlossberg, director of currency research at GFT Forex in New York.

ANZ bank said a brief foray by the NZ dollar back above US75c yesterday evening was short lived as the European and North American traders sought safe haven harbours in the form of the US dollar.

It expected further tentative tests of support levels for the NZ dollar.

Against the European currency, the kiwi was little changed at 0.5034 euro at 8am, and eased slightly to A81.26c. The trade weighted index was 67.05 at 8am from 67.22 at 5pm.

- NZPA