KEY POINTS:
The New Zealand dollar limped back up to US51c today, struggling against weak equity markets and little local information.
At 5pm today it was worth US51.01c, down on US51.25c at the same time yesterday.
During today it reached a low of US50.44c about lunchtime before struggling back up to the US51c mark.
It struggled on the back of weaker equity markets, and with no key data this week, was reliant on external moves, said ANZ chief foreign exchange dealer Murray Hindley.
"The gains that we saw yesterday have been eroded and we are back re-testing US50.50c again," he said.
A recovery since around lunchtime was probably a little short in the Asian session after this morning's sell off, and it was waiting on fresh direction from London markets, he said.
Overnight there would probably be a cap of US51.10c and the dollar would re-test US50.50c.
Against the Australian dollar the kiwi was up to A79.09 from A78.92c at 5pm yesterday.
It was up to 0.4012 euro from 0.3968, up to 48.50 Japanese yen from 47.60, and down to 35.06 British pence from 35.26p yesterday.
The trade weighted index was up to 52.16 from 51.93.
Meanwhile, offshore, the US dollar steadied, hovering near a three-month high against the yen on expectations the US government would stay more pro-active than other nations in fighting the financial crisis.
The US Treasury Department, Federal Reserve and three other federal agencies jointly said on Monday that they will initiate a programme on Wednesday to assess large US banks' capital needs and determine whether a bigger buffer is warranted.
Currency moves were muted, however, as investors wanted to assess the implications of a sharp fall in global share prices before taking positions aggressively, traders said.
Tokyo's Nikkei share average fell 2.6 per cent in morning trade, in sight of a 26-year trough below 7,000, after Wall Street slumped to a 12-year low overnight.
The dollar was little changed against the Japanese currency from late US trade at 94.61 yen, holding close to a three-month high of 94.95 yen hit on trading platform EBS on Monday.
The euro was up 0.1 per cent at $1.2709, but well below a 12-day peak of $1.2992 hit on EBS the previous day.
The European single currency firmed 0.1 per cent to 120.20 yen, still well off a one-month peak of 121.92 yen reached the previous day.
Investors expect the ECB to lower interest rates in March from the current 2.0 per cent.
- NZPA
