Steep fall for NZ dollar

The New Zealand dollar fell steeply against the greenback and the yen as economic uncertainty boosted safe-haven demand for the United States and Japanese currencies.

Around 8am today the kiwi was buying US71.75c, down from US73.24c at 5pm on Friday. The NZ dollar was also down to 64.48 yen from 66.87.

BNZ Capital strategist Mike Jones said the NZ dollar found few friends on Friday night.

Generally lacklustre US personal spending and consumer confidence data highlighted the fragility of the US economic recovery, he said.

At the same time, renewed fears about the US financial sector further weighed on equity markets.

The backdrop of falling equities and rising risk aversion saw investors shun growth-sensitive currencies such as the kiwi, in favour of the relative safety of the US dollar and yen, Mr Jones said.

The NZ dollar was the worst performing currency last week, having started the week above US75.50c, then declining 4.8 per cent against the greenback.

The NZ dollar was also down to 0.4871 euro at 8am today from 0.4932 at 5pm on Friday, and eased to A79.73c against the Australian dollar from A79.89c. The trade weighted index fell to 64.66 at 8am from 65.75 on Friday evening.

- NZPA