The United Nations' report on weapons in Iraq was a damp squib from the New Zealand dollar's point of view.
A tougher than expected report from UN arms inspector Hans Blix, ahead of tomorrow's presidential state of the union speech in the United States, softened the US dollar and failed to fire up the kiwi.
Markets were waiting to see whether heightened war talk would weaken or strengthen the greenback and boost safe haven currencies.
By 5pm the kiwi was at US54.56c, down from last night's close of US54.95c. The aussie was at US58.98c (US59.35c yesterday), while on the trans-Tasman cross the kiwi eased slightly to A92.55c (A92.59c).
One local dealer said it had been an average day for the kiwi, although volume was moderate as players returned to the market following yesterday's holidays in Auckland and Australia.
The kiwi has fallen foul of profit-takers since retreating below US55c at the end of last week, with the market clearing out long positions which bet the currency will continue rising.
The kiwi traded between US54.50c/87c today, and it was likely to see a range overnight of US54.40c/85c, the dealer said.
Offshore equities markets suffered heavily overnight ahead of the Blix report, which concluded that Iraq still had not accepted the UN mandate to disarm.
In Wellington at 5pm the euro was at $US1.0836, down from last night's $US1.0841. Against the yen, the greenback was trading at 118.43, from 117.85 yen last night.
At 5pm New Zealand's trade-weighted index was at 59.97 (60.28), 90-day bank bills were unchanged at 5.83 per cent, and the monetary conditions index was at plus 130 (plus 154).
Against other major currencies the kiwi fell to 0.5035 euro (0.5068), 64.60 yen (64.85 yen), 33.37 pence (33.63), and 0.7391 Swiss francs (0.7434).
The Australian dollar was at $NZ1.0802 ($NZ1.0801).
On the debt market the April 2004 government bonds were at 5.49 per cent (5.51), the November 2006s were at 5.67 per cent (5.68), the November 2011s were flat at 5.99 per cent, and the April 2013s were steady at 6.02 per cent.
- NZPA
<i>Currency:</i> Kiwi fails to fire on weaker US dollar, equities
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