The New Zealand dollar bounced off a new record low set overnight Monday at US40.70c as exporters and fund managers took advantage of its cheapness.
The kiwi finished at US41.36c, recouping most of its losses since Monday's close of US41.42c.
Notwithstanding yesterday's bounce, dealers see the kiwi trending lower to US40c, with little chance of a boost from a sustained turnaround in the euro or Australian dollar.
Deutsche Bank's Phil Lindberg said the apparent poor response to Finance Minister Michael Cullen's comments in Europe on the reasons for currency weakness was disappointing given a sharp revision to the good regarding the current account deficit.
But the local currency wasn't alone in the doldrums - the Australian dollar also plummeted to a new low of US54.09c, the pound hit a 14-year low of $US1.3962 and the euro struggled at US85.12c.
The Australian dollar recovered to close at US54.39c.
- NZPA
<i>Currency:</i> Kiwi bounces from fresh low
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