The New Zealand dollar closed well under 45USc on light volume, near lows seen during the overnight session.
The kiwi ended the session at 44.42c, compared with 44.79c at 7.30 am. It had been sold off overnight to a low of 44.35c.
Greenwich Financial Services director Earl White said the kiwi struggled to get back towards 45USc, despite a stable euro and weaker yen.
The Australian dollar's tumble below 56USc, ending the New Zealand session at 55.78c, was the catalyst to its southern cousin's fall, Mr White said.
"We saw a bit of interest from US investment houses taking profit, and we haven't seen massive importer selling. It's been more investor-related flows and I suspect they would be short-term speculators taking profit.
"With the aussie under 56USc the kiwi just couldn't hold on. The aussie has actually gone lower, so there may be a little bit more in this yet," he said.
The kiwi has gained a massive 16 per cent in the past six weeks. "We've had a big rush up and closed last year around 44c, and pushed on up to 45.50c when everyone came back from holidays and thought they had missed the boat.
"Considering we had moved from 39.05c at the end of November and we pushed up to 45.45c in under six weeks - there had to be some people with positions with reasonable profits on them, and it's to be expected we've seen some profit-taking."
"The market is going to be nervous about pushing [the kiwi] too far one way or the other with the consumer price index coming out next week, and the official cash rate review."
- NZPA
<i>Currency:</i> Profit-takers drive down dollar
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