The New Zealand dollar held above 79 US cents as leaders from the Group of 20 nations increased pressure on European Union policy makers.

Wall St was up overnight as investors opted to rekindle optimism the US Federal Reserve will come up with new stimulus measures.

The New Zealand dollar fell from a one-month high after Federal Reserve Chairmen Ben Bernanke failed to signal further quantitative easing for the US.

The dollar rose almost one US cent on optimism European policymakers will act to stimulate the region's economy and provide aid for Spanish banks.

The New Zealand dollar fell after G7 leaders nations agreed to a coordinated response to Europe's deteriorating financial crisis, though gave no guidance on how to do so.

TSB has cut its two-year mortgage rate to 5.3 per cent from 5.5 per cent.