The kiwi's feathers were unruffled today after the Reserve Bank cut the official cash rate to 4.75 per cent, swiping off 50 points in a widely anticipated move.
At 5pm, the kiwi was at US42.18c from US42.24c at yesterday's close.
"It has been relatively quiet after the Reserve Bank cut really," one local currency dealer said.
"It is a very, very muted market at the moment. The kiwi is still looking towards the Australian dollar for direction."
The OCR, the benchmark for commercial banks to determine home lending interest rates, is now at its lowest level since it was introduced in March 1999 at 4.50 per cent.
With little in the way of data due out overnight, dealers expected the kiwi to trade between US42.10c and US42.30c.
"Our future moves will depend on which way the aussie goes. The kiwi is still reluctant to move higher but if the aussie can stretch these gains then the kiwi will probably go with it," the local dealer said.
The Australian dollar ended locally at US52.10c from US52.03c late yesterday.
On the crosses at 5pm the kiwi traded at A80.94c (A81.20c at yesterday's close), 0.4785 euros (0.4736), 51.17 yen (51.07), 29.24 pence (29.07), 0.9358 marks (0.9262), and 0.7038 Swiss francs (0.6948). The Australian dollar was buying $NZ1.2370 from $NZ1.2316 yesterday.
The trade-weighted index was at 50.21 (50.10), the 90-day bank bills - from which floating mortgage rates are funded - were at 4.85 per cent (4.88), and the monetary conditions index tightened to minus 858 (minus 865).
On the debt market, the March 2002 bonds were at 4.74 per cent (4.78), the April 2004s were steady at 5.06 per cent, the November 2006s were at 5.60 per cent (5.57), and the November 2011s were at 6.11 per cent (6.08).
- NZPA
<i>Currency: </i> Kiwi unruffled by interest rate cut
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