The New Zealand dollar fell to a new five-month low against the yen as heightened tensions around North Korea sapped investors' risk appetite and stoked demand for safe-haven assets.
The kiwi dollar slipped to 75.93 Japanese yen as at 8:30 am in Wellington and earlier touched 75.64 yen, the lowest since Nov. 14, versus 76.04 yen late yesterday. The trade-weighted index was little changed at 75.80 from 75.77.
Reuters reported that foreign journalists visiting North Korea have been told to prepare for a "big and important event" on Thursday, although there were no indications it was directly linked to tensions in the region over the isolated state's nuclear weapons program.
Tensions remain high, with a US Navy strike group steaming toward the western Pacific in a show of force and North Korea warning of a nuclear attack on the United States at any sign of American aggression. The Chicago Board Options Exchange Volatility Index, known as Wall Street's fear gauge, reached 15.73 overnight, the highest since early November.
"US equities continued to sell off with the VIX rising (it has risen more than 20 per cent in four days)," said Cameron Bagrie, ANZ chief economist, in a note.