The New Zealand dollar dropped as investors continue to favour the US on signs of a revival in the world's largest economy.
The kiwi fell to 77.29 US cents from 77.71 cents at 5pm in Wellington Friday and 77.52 cents at the New York close Friday, when it dipped below 77 cents for the first time in a year.
The Federal Reserve last week said it may wind back its US$85 billion a month of bond buying this year and end the stimulus programme in 2014. The Federal Open Market Committee said that risks to the US economy have decreased, as they lowered forecasts for unemployment and inflation this year. That has boosted the greenback and lessened demand for more risk-sensitive currencies such as the kiwi.
"I expect the kiwi to retest 77 US cents in the early part of this week," said Sam Tuck, senior manager FX at ANZ New Zealand. "Volatility will remain high."
In New Zealand today, reports are due on credit card spending and migration. They follow a slew of recent upbeat reports on consumer confidence, manufacturing and service sector activity.