The New Zealand dollar lost nearly half a cent today after much worse than expected trade data for July.
The kiwi had opened just under US64c but ended the session on US63.52c against US63.82c yesterday.
Soaring oil prices and the import of an aircraft sent New Zealand's trade deficit to $745 million in July, far worse that the $425m median forecast by economists.
Economists said that while the headline trade number looked awful, it was deceptive and the underlying picture was not so dire.
However, BNZ economist Stephen Toplis said there would still be pressure on the current account and the dollar.
"Unless we are fortuitous to be the recipient of a major reduction in oil and hard commodity prices, it appears that the current pressure on our external accounts and the NZD will stay with us for some time to come."
Against the Australian dollar, the kiwi ended at A83.51c, down from A83.71c yesterday.
The kiwi also weakened against other majors, particularly yen where it fell to 73.98 yen from 74.29 and the TWI closed on 63.53 from 63.76.
ANZ Bank today said that given the kiwi's strong performance during the past three weeks, it was vulnerable to a corrective move and the poor July trade balance could provide that.
The euro fell today as investors awaited data on the business climate in Germany for more clues about the economic outlook in the euro zone.
The euro had risen against the US dollar immediately after data showed US existing home sales fell for a fourth straight month in July and marked the slowest pace since January 2004, cementing expectations for US interest rates to stay on hold.
But profit-taking in the euro, which has appreciated 3 per cent against the dollar since mid-July, helped the US currency to erase losses.
Rates
Today 5pm yesterday
NZ dlr/US dlr US63.52c US63.82c
NZ dlr/Aust dlr A83.51c A83.71c
NZ dlr/euro 0.4980 0.4989
NZ dlr/yen 73.98 74.29
NZ dlr/stg 33.60p 33.81p
NZ TWI 63.53 63.76
Australian dollar US76.05c US76.23c
Euro/US dollar US1.2767 US1.2789
US dollar/yen 116.42 116.42
- NZPA
<i>Currency:</i> Ugly trade figure sends dollar lower
AdvertisementAdvertise with NZME.