The New Zealand dollar drifted off today, along with its fellow travelling partners the Australian dollar and the euro.
At 5pm the kiwi had drifted to US43.70c from US43.91c at yesterday's close, while the aussie was at US52.76c from US53.13c yesterday.
One local dealer said profit-takers were targeting the three currencies, which have piled on substantial gains in tandem with the falling US dollar.
The kiwi traded in a range of US43.66/94c during the day and the dealer picked it to be capped at US43.80c overnight, with initial support at US43.50c.
"Generally it's been pretty lacklustre. Just a bit of correction over the recent (upward) moves that we've had, the strength that we've had," he said.
The market remains focused on whether the European Central Bank will cut rates at its meeting this week. A decision will be announced on Friday morning New Zealand time.
The market is concerned the ECB may not cut its 4.5 percent benchmark rate and if it fails to deliver, traders will sell the euro and probably the kiwi as a consequence.
The 12-nation currency may also be pushed down on concern a report tonight will show money supply, one measure of inflation, rose in July.
Meanwhile a report tonight on US consumer spending, which accounts for two-thirds of gross domestic product, is expected to show a rebound in August which will provide further impetus for the greenback.
By 5pm the euro had dropped to US90.88c from its US91.12c close here yesterday.
Ironically a decision early next month by the Reserve Bank of Australia to cut rates again would be seen as a negative for the aussie. It would open up an interest rate differential with the kiwi and be an indication of continuing economic weakness there, dealers said.
On the crosses at 5pm the kiwi was buying A82.83c (A82.62c at yesterday's close), 52.59 yen (52.75), 30.31 pence (30.46), 0.9405 marks (0.9424), 0.7295 Swiss francs (0.7322), and 0.4808 euros (0.4819).
The aussie was buying $NZ1.2074 from $NZ1.2172 yesterday.
The trade-weighted index was at 51.46 (51.61), 90-day bills were slightly lower at 5.85 percent (5.86 percent) and the monetary conditions index eased to minus 634 (minus 618).
On the bond market, the March 2002s were at 5.70 percent (5.73), the April 2004s were at 6.15 percent (6.21), the November 2006s were at 6.35 percent (6.41), and the November 2011s were at 6.51 percent (6.57).
- NZPA
<i>Currency:</i> Kiwi falls victim to profit taking
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