The New Zealand dollar today pulled back from the 16-year peak it closed at yesterday.
The weakness in the United States dollar that pushed the kiwi to yesterday's US72.57c high, abated and the big dollar rallied in New York trading against most currencies.
Yesterday's apex in the kiwi was just 18 basis points off its post-float high of US72.75c hit in June 1988.
BNZ currency strategist Sue Trinh said the kiwi had pretty much traded sideways throughout the day. At 5pm the kiwi had eased to US71.73c from its US72.12c close yesterday, having ranged between US71.55c and US71.82c today.
The US dollar edged up today, building on a rebound on Thursday as traders locked in profits from a round of US dollar-selling that drove the euro to record highs, the yen to a five-year peak and sterling to a 12-year high.
But traders remained cautious ahead of the all-important non-farm payroll data due out from the US tonight.
"That's normally quite a big number in terms of swinging the market one way or the other, and so the market just seems to be in consolidation mode, or lying in wait, ahead of those numbers," Ms Trinh said. Traders also remained nervous about the possibility of currency market intervention, especially from Japan to curb yen strength, but traders said they had not seen any signs of intervention.
Japan insisted on Thursday that its concern about the dollar's steep decline was shared by Europe and the United States, keeping the market guessing about possible concerted action.
At 5pm the euro was buying US$1.3285 compared with the US$1.3383 record hit in overnight trading while the US dollar was trading at 103.44 yen from 102.30 at yesterday's close.
The Australian dollar was at US77.50c compared with its US77.62c close here yesterday.
On the crosses, the kiwi was trading at A92.50c (A92.36c), 0.5400 euro (0.5397), 37.31 British pence (37.29), 74.16 yen (73.79), and 0.8252 Swiss francs (0.8209).
On the money market, 90-day bank bill yields were unchanged at 6.67 per cent, February 2006 bond yields were at 6.23 per cent (from 6.21 per cent), July 2009s were at 6.00 per cent (5.97) and April 2013s were at 5.98 per cent (5.95 per cent).
The trade-weighted index was at 69.27 (69.30), and the monetary conditions index was at plus 934 (937).
- NZPA, REUTERS
<EM>Currency:</EM> Kiwi retreats from 16-year high
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