The dollar closed slightly down at 39.63USc in quiet trading yesterday as uncertainty about the US presidential elections continued.
It opened at 39.78USc after peaking above 40USc on Wednesday.
Mark Elliott of ANZ Investment Bank said the kiwi followed the sold-down Australian dollar.
"There was no particular event, it was just commercial interest selling," Mr Elliott said.
"Once [the Australian dollar] went through 52.60USc, which is the level it's held above for a few days, stop-loss selling took over and away it went, and the kiwi's just gone on the back of it."
Mr Elliott expects to see the kiwi lift to 41USc or 42USc in the short term.
It traded within a fairly tight range of 39.60USc-94c yesterday, but seemed relatively unaffected by the uncertainty in the US presidential election.
"The kiwi's looking a bit soft but probably not going to run away on the down side," Mr Elliott said.
"I wouldn't try to over-intellectualise it in terms of the election. Certainly the US dollar's a bit stronger than it was before the election news, or lack of, but there was a pretty muted response from the kiwi and the aussie.
"There was strength in the US dollar against the major European currencies. Any exaggerated sell-off from here I think will be short-lived. I'm picking there will be a bit of a recovery [for the kiwi] in the next few weeks."
- NZPA
<i>Currency:</i> Kiwi follows 'sold-down' aussie
AdvertisementAdvertise with NZME.