The New Zealand dollar fell against a broadly stronger US dollar that was helped by improving US data in a market where equities are charting record highs.

The kiwi declined to 72.47 US cents as at 8am in Wellington from 72.84 cents late yesterday. The trade-weighted index fell to 79.29 from 79.42.

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The local currency gained yesterday after figures showed inflation has moved back within the Reserve Bank's target band and has accelerated more than the bank was projecting.

The US dollar index had retreated since reaching a 15-year high at the start of this month on euphoria over US president Donald Trump.

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It rose overnight after data including the Markit Services PMI, which chalked up its 11th straight month of growth.

The Dow Jones Industrial Average topped 20,000 for the first time.

"US data by and large beat expectations overnight, highlighting improving growth momentum," said David Croy, senior rates strategist at ANZ Bank New Zealand, in a note. "Having distanced itself from post-election correlations with bond yields and equities, the USD has made a comeback, to the detriment of the NZD. This is likely to continue as Trump cements his credentials as a man of action (regardless of one's views on those actions)."

The Reserve Bank releases its next monetary policy statement on February 9.

Its November MPS projected a flat track for the official cash rate, currently at a record low 1.75 per cent, out to December 2019, but traders are betting it will embark on a tightening cycle this year, given the sturdy pace of economic growth and signs inflation is reviving.

The kiwi traded at 96.03 Australian cents from 96.14 cents yesterday. It was at 4.9843 yuan from 5.0099 yuan and traded at 67.75 euro cents from 67.68 cents. It traded at 57.51 British pence from 57.59 pence and rose to 82.92 yen from 82.53 yen.