The New Zealand dollar hovered around its 200-day moving average of 84.60 US cents as traders mull whether its 3.9 percent decline over the past month was enough.
The kiwi traded at 84.60 US cents at 8am in Wellington, from 84.56 cents at the New York close and 84.44 cents
at 5pm in Wellington on Friday. The trade-weighted index advanced to 79.34 from 79.26 on Friday.
The New Zealand dollar has been in decline since touching a high of 88.35 US cents last month amid weakening commodity prices, a pause in interest rate hikes, Reserve Bank intervention threats and increased demand for the greenback. Traders are weighing the negative effects of geopolitical tensions in Ukraine and Iraq alongside signs demand may rise from China as they consider whether the kiwi may slip further.
The kiwi is "fragile", said Peter Cavanaugh, client advisor at Bancorp Treasury Services. "It really is teetering, but teetering could go one way or the other. It's moved a long way. There's potential for more, but equally it has gone a long way and the yield story remains attractive."
Even though New Zealand's central bank has paused its hiking cycle, it's still likely to hike rates one or two more times before any of the leading industrialised nations start raising interest rates, Cavanaugh said.
