The New Zealand dollar fell over half a US cent today to its lowest level this year after weaker than expected retail sales over the crucial Christmas quarter.
"The market didn't like the headline number," said ANZ Investment bank chief dealer in Wellington, Murray Hindley.
Bank bill yields fell while bill futures rallied on expectation that the Reserve Bank may have to ease its tight monetary stance earlier than expected.
Inflation and seasonally adjusted retail sales in the December quarter fell 0.7 per cent from the September quarter, Statistics New Zealand said. Without inflation adjusting, sales were down 0.4 per cent -- the first quarterly fall since June 1998.
The kiwi closed on US67.40 from US67.94c at 5pm yesterday.
There was an even sharper fall against the Australian dollar with the cross rate closing on A91.52c from A92.23c yesterday.
The currency fell on all the crosses.
Mr Hindley said there would be initial support for the kiwi at US66.85c, but he said all the data was pointing to the economy slowing further and that would see the kiwi trend lower.
Earlier today, there was more evidence of the slowdown via an apparent softening in the job market. ANZ's latest Job Vacancy Monitor showing the number of vacancies advertised in newspapers and on the internet fell.
The Australian dollar held firm against the US dollar at US73.68c.
rates:
5pm today 5pm Monday
NZ dlr US67.40c US67.94c
NZ dlr/Aust dlr A91.52c A92.23c
NZ dlr/euro 0.55.65 0.5713
NZ dlr/yen 79.18 80.14
NZ dlr/stg 38.72p 39.01p
NZ TWI 69.56 70.19
Australian dollar US73.68c US73.67c
Euro/US dollar US1.1905 US1.1894
US dollar/yen 117.42 117.93
- NZPA
<EM>Currency:</EM> Kiwi falls half a cent
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