NZ dollar remains weak, down against US

The New Zealand dollar hit its lowest point in more than a week against the broadly rising greenback as investors awaited an interest rate announcement by the United States Federal Reserve.

Markets expect at least some form of modest easing when the Fed meets, with some speculation it could revive a plan to buy Treasury and mortgage debt to give the economy a boost.

The Fed's statement is expected about 6.15am tomorrow, NZT.

With US interest rates already effectively at zero per cent, the central bank is out of easy policy options. Top Fed officials argue, however, they can do more to fight renewed economic weakness, including reinvesting proceeds from maturing mortgage bonds back into that market.

By 5pm, the kiwi fell to US72.26c, down from US72.86c this morning and almost US1c lower than 5pm yesterday.

The NZ dollar was also down significantly against other major trading partners aside from sterling, which it eased against to 45.74c from 45.79p late yesterday afternoon.

Against the aussie, the kiwi was at A79.30c from A79.71c at 5pm yesterday. It fell to 62.02 yen from 62.55 yen, and 0.5496 euro from 0.5510.

Reflecting the decline, the trade weighted index eased to 66.78 from 67.25.

The Australian dollar and euro also slid against the US dollar, although the yen strengthened.

Markets fear Japanese authorities could intervene to weaken the yen so that strength does not derail a fragile, export-led recovery, with Japan's finance minister expressing concern about yen strength.

- NZPA