The New Zealand dollar tumbled below US48c yesterday as the euro lost its grip on parity with the US dollar.
By 5pm the kiwi was at US47.43c - a full cent lower than Monday's local close. The Australian dollar was buying US54.24c (US55.47c), while the euro slipped to US99.74c ($US1.010).
Dealers said commodity currencies like the kiwi, aussie and Canadian dollar were sold off during the London and New York sessions overnight and that pattern continued yesterday.
The beleaguered US dollar managed to shrug off the black clouds hanging over American stock markets and strengthen back beyond parity with the euro for the first time in a week, although traders said it was only because US funds were raising cash to repay investors cashing out of equities.
"There seems to be a repatriation towards the US, at the expense of the euro, and the kiwi and aussie have trailed down with it," one local dealer said.
The kiwi was expected to trade lower again overnight, with US47.25c a key level of resistance on the downside, while US48c was seen as the cap on the topside.
On the crosses at 5pm the kiwi was buying A87.45c (A87.31c at Monday's close); 55.57 yen (56.23), 30.19 pence (30.76), 0.6927 Swiss francs (0.6991) and 0.4754 euro (0.4797).
The aussie was buying $NZ1.1440 ($NZ1.1461).
On the money market, 90-day bills were flat at 6.02 per cent, the trade-weighted index was at 53.85 (54.54) and the monetary conditions index was at minus 392 (minus 328).
On the debt market, the April 2004 bonds were at 5.70 per cent (5.71), the November 2006 bonds were at 6.24 per cent (6.13), and the November 2011 bonds were at 6.49 per cent (6.47).
- NZPA
<i>Currency:</i> Kiwi falls below US48c
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