KEY POINTS:
The New Zealand dollar failed to make up ground lost overnight amid falling commodity prices and credit concerns, drifting today below US76c with little direction.
By 5pm, the kiwi was US75.43c, down about US1c from late yesterday and down slightly from this morning's US76.47c level.
Against the Australian dollar, the kiwi rose to A85.28c from yesterday's A84.97c, but it tumbled to 82.96 yen from 85.14 yen late yesterday.
Sentiment towards the kiwi was nervous but not panicky, with the currency likely to remain under pressure due to concerns about offshore markets, said Westpac currency strategist Michael Gordon.
"Subprime mortgage losses and writedowns on Wall Street etc are not directly a New Zealand dollar issue, but when investors get nervous they tend to pull back from markets they don't have to be in, and for the most part offshore investors don't really have to be in the kiwi."
But there was no clear case for a sharply lower kiwi given the strength of the local economy, Mr Gordon said.
The Aussie was taking a harder fall than the kiwi, as buyers who had jumped in as it headed towards parity with the US dollar sold out. The Aussie hit a high just above US94c last week, and is now at A88.46c.
The yen rose today, picking up from an early fall as a slide in Asian stocks kept investors cautious about holding onto risky carry trades given ongoing concerns about global credit problems.
Standard & Poor's cut its long-term credit rating on Bear Stearns by one notch to A on Thursday, as the company is set to report its first quarterly loss, hit by problems related to US subprime mortgage loans.
Barclays, Britain's third-largest bank, announced a A3;1.3 billion ($3.6 billion) write-down for losses on subprime mortgage-linked securities, but the amount was less than expected.
Reuters currency rates
5pm today 5pm yesterday
NZ dlr/US dlr US75.43c US76.47
NZ dlr/Aust dlr A85.28c A84.97c
NZ dlr/euro 0.5162 0.5210
NZ dlr/yen 82.96 85.14
NZ dlr/stg 36.93p 36.17p
NZ TWI 69.72 70.48
Australian dollar US88.46c US89.99c
Euro/US dollar 1.4613 1.4679
US dollar/yen 110.00 111.29
- NZPA