The New Zealand dollar's fall was temporarily arrested in steady trading today, although dealers said the downtrend was now well established.
"The market is certainly looking to sell rallies," a senior Auckland dealer said.
"It's just biding a bit of time. Given the speed of the move that we've seen, I think the market will be waiting for tomorrow night's Bank of England and European Central Bank decisions on rates."
The kiwi closed the session where it began on US67.65c having hit a fresh low overnight of US67.35c. It had closed yesterday at US67.97c.
Bank of New Zealand currency strategist Sue Trinh said sentiment was firmly bearish.
"The underlying fundamentals of the New Zealand dollar are deteriorating."
The latest ANZ commodity price index released today did nothing to improve the tone. It showed prices fell by 0.8 per cent in June - a sign that the recent strong run for local export prices may have peaked. In New Zealand dollar terms, the index was flat on the month as a result of the currency's fall.
A Westpac-McDermott Miller survey of employee confidence fell to 130.2 in the June quarter from the previous quarter's 131.3. It was the second consecutive quarterly fall.
The Australian dollar's fall for similar reasons to the kiwi was even more pronounced and the kiwi made up nearly half a cent on the aussie cross rate.
The aussie finished on US74.25c from US74.98c here yesterday. Global investors speculated it was vulnerable amidst the weakening global economic cycle.
It has lost US1.16c since Monday's open.
"It has been quite an amazing move over the past week or so," ABN Amro head of foreign exchange strategy David Mozina said.
"The Aussie is down 1.1 per cent over the 24 hour trading period and it was the worst performer of all the majors."
On its crosses, the kiwi was buying A91.08c (A90.61c), 38.50 British pence (38.59), 0.5675 euro (0.5708), 0.8812 Swiss francs (0.8855) and 75.40 yen (75.92).
The TWI was at 68.98 (69.22) and the monetary conditions index was at plus 941 (964).
The US dollar weakened a little to 111.69 yen (111.62 at 5pm yesterday), while the euro firmed to US$1.1918 from US$1.912 yesterday.
On the money markets, 90-day bank bill yields were at 7.04 per cent (7.03 per cent yesterday). Bond yields continued to fall in line with the weakening economic outlook. July 2009 bond yields fell to 5.89 per cent (5.91), and the April 2015s eased to 5.77 per cent (5.78).
- NZPA
<EM>Currency:</EM> Kiwi dollars arrests slide
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