The New Zealand dollar slumped under US67c to a 16-month low as more dour economic data piled up.
It closed sharply lower on all its crosses, including a near one cent loss against the Australian dollar.
It finished the week at US66.73c from US67.35c at 5pm yesterday while against the Australian dollar it fell to A90.45c from A91.27c.
The latest Performance of Manufacturing Index released today showed manufacturing continued to contract in January, and added to other soft data suggesting an easing is not far away.
The index showed manufacturing activity touched a new all-time low in January of 44.1, surpassing December's 47.6 reading. Any reading below 50 indicates a general contraction.
The data came on the heels of other bad news for the economy, namely the Produce Price Index, which showed inputs inflation running strongly, but outputs inflation much lower than expected.
Comments by Economic Development Minister Trevor Mallard today that he would like to see the dollar higher in the medium to long term were completely ignored by the market. Mr Mallard said a strong New Zealand dollar should go hand-in-hand with a strong economy.
"In fact, I hope and expect that in the medium to long term the dollar will be higher than now."
The US dollar is expected to trend higher with most US economic data strong and new Federal Reserve chairman Ben Bernanke wishing to establish his credentials as an inflation hawke.
The Australian dollar closed on US73.77c compared with US73.80c yesterday.
The following are Reuters currency rates:
5pm today 5pm Thursday
NZ dlr US66.73c US67.35c
NZ dlr/Aust dlr A90.45c A91.27c
NZ dlr/euro 0.5618 0.5670
NZ dlr/yen 78.92 79.42
NZ dlr/stg 38.48p 38.70p
NZ TWI 68.98 69.58
Australian dollar US73.77c US73.80c
Euro/US dollar US1.1879 US1.1881
US dollar/yen 118.24 117.93
- NZPA
<EM>Currency:</EM> NZ dollar falls below US67c
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