Currency: Kiwi heads south

The New Zealand dollar turned in a lazy performance on its major crosses today, losing some ground against its United States counterpart.

At 5pm, the kiwi was at US69.79c (from US70.12c at 5pm yesterday), which was its session low.

BNZ currency strategist Sue Trinh said the kiwi's yield story helped support it against a broadly stronger greenback.

"Basically it's the yield starved offshore investors who've been buying the kiwi," she said, referring to the Reserve Bank of New Zealand's official cash rate of 6.5 per cent.

"But the US dollar is the bigger driver here," she said.

It was possible that New Zealand's trade deficit data, which was released today, also had some effect on the kiwi's southward tack.

The December trade deficit was revised up to $499 million from the provisional early estimate of $493m, Statistics New Zealand said.

Economists had expected a deficit of $555m for the month.

The trade deficit for 2004 revised to $4.18 billion from $4.17b.

Meanwhile, the aussie was at US76.44c (US76.65c), the greenback was at 105.67 yen (105.02), and the euro was at US$1.2758 (US$1.2765).

On its other major crosses, the kiwi was at 0.5470 euro (0.5515), 37.65 British pence (37.75), 73.74 yen (73.62) and 0.8535 Swiss francs (0.8584).

The monetary conditions index was unchanged at plus 906, while the trade weighted index (TWI ) was at 68.70 (68.96).

On the money markets, 90-day bank bill yields were at 6.81 per cent (6.80), November 2006 bond yields were unchanged at 6.37 per cent, July 2009s were static at 6.08 per cent, and April 2015s were at 5.91 per cent (5.92).

- NZPA