The New Zealand dollar lost 51 basis points against its Australian counterpart after a sell-off sparked by the Reserve Bank of Australia's interest rate call today.
At 5pm, the kiwi was fetching A91.76c, 51 basis points down on Friday's closing level of A92.27c.
Today, the kiwi-aussie ranged between A91.71c and A92.29c, having started at A92.21c at 8.30am.
Against the US dollar, the kiwi was at US70.75c (from US70.93 at 5pm on Friday). It traded between US70.68c and US70.95c today.
A National Bank currency spokesman said the kiwi was sold-off against the aussie after the RBA's monetary policy statement this morning.
"The RBA made a couple of statements implying capacity constraints in the economy could mean further rate rises in Australia," the spokesman told NZPA today.
"It's been quite a big (downward) move on the kiwi-aussie cross... you might expect some retracement," he said.
The RBA's said risks were growing on the inflation front.
It also said inflation was likely to reach three per cent next year -- at the top of the two per cent to three per cent board target.
Meanwhile, the greenback was at 104.21 yen (104.48), the euro was at US$1.2830 (US$1.2966), and the aussie was buying US77.10c (US76.88c).
On its other major crosses, the kiwi was at 0.5515 euro (0.5470), 37.78 British pence (37.71), 73.72 yen (74.10), and 0.8590 Swiss francs (0.8533).
This weekend's Group of Seven meeting provided no change in its forex policy, which was that exchange rates should reflect economic fundamentals and that excess volatility was undesirable.
Prior to the meeting there had been some talk the group would increase pressure on China to ease its currency peg.
The Reserve Bank of New Zealand's monetary conditions index was at plus 941 (944) while the trade weighted index (TWI ) was at 69.21 (69.25).
On the money markets, 90-day bank bill yields were unchanged at 6.79 per cent, November 2006 bond yields were at 6.36 per cent (6.31), July 2009s were at 6.08 per cent (6.06), and April 2015s were static at 5.94 per cent.
- NZPA
<EM>Currency:</EM> NZ dollar sheds 51 basis points against aussie on RBA statement
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