The kiwi ground steadily lower today, reversing much of the gains seen in strong overnight trading.
At 5pm the kiwi was buying US66.37c, (from US66.09c at 5pm last night). The kiwi traded as high as US66.85 overnight and early this morning on the back of a weak greenback.
The Australian dollar was at US76.14c at 5pm (US75.80c). BNZ currency strategist Sue Trinh said the market had been closing out a number of long positions against the euro heading into tonight's policy and rate announcement by the European Central Bank (ECB).
"People have been taking some of their money off the table ahead of that," Ms Trinh said.
The market is not expecting the ECB to ease rates tonight despite mounting pressure for a euro zone rate cut.
But Ms Trinh said a cut in the coming months is expected and all ears will be on the bank's policy statement for hints of what is to come. She said anything to dispel thoughts that a rate cut is on the way will probably see the euro rally, while anything that confirms that rates will ease later this year was likely to put the euro under pressure. "And the kiwi will continue trading on the back of the euro," she added.
At 5pm tonight, the US dollar was fetching 104.18 yen, compared with 105.63 yen at the same time yesterday.
The euro was buying US$1.2277 (US$1.2174).
Meanwhile, on the crosses, the kiwi was buying A87.18c (A87.20c), 0.5405 euro (0.5409), 69.13 yen (68.97), 36.00 British pence (36.07), and 0.8421 Swiss francs (0.8435).
The trade-weighted index was at 65.76 (65.70), while the monetary conditions index was at plus 559 (553).
Ninety-day bank bill yields were at 5.54 per cent (5.52).
The February 2006 yields were at 5.32 per cent (5.33), July 2009s were at 5.58 per cent (5.61), and April 2013s were at 5.74 per cent (5.77). NZPA WGT kp ob
- NZPA
<i>Currency:</i> Kiwi loses some overnight gains
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