The New Zealand dollar turned lower as a rally ran out of steam and as investors around the world assessed the implications of the swine flu outbreak.
By 5pm the NZ dollar was buying US56.43c, down from US57.21c at 8am, but up from US56.20c at 5pm on Friday.
There is
much talk globally about the implications of the spread of swine flu and the Mexican peso has tumbled to near three week lows.
Bloomberg reported that currencies like the New Zealand and Australian dollars were affected by worries about the tourism industry.
BNZ Capital currency strategist Danica Hampton said swine flu was an issue at the margins in the foreign exchange market.
"People know about it. People are talking about it but it is not really the big driver of the currency.
"What we have seen today is a reversal of the squeeze we saw on Friday night," she said.
Traders squared up on Friday ahead of a Group of Seven meeting.
"They came in Monday morning and looked at the currencies and they all looked too high and they are buying US dollars against everything," she said.
The NZ dollar was little changed at 0.4287 euro from 0.4275 on Friday.
It fell against a rising yen to 54.60 yen from 55.57 yen at 8am but was little changed from 54.55 on Friday.
Against the Australian dollar, the NZ dollar lifted to A79.20c from A78.86c on Friday, with the trade weighted index at 56.12 from 55.93 on Friday.
Reuters currency rates:
NZ dlr/US dlr US56.43c US56.20c
NZ dlr/Aust dlr A79.20c A78.86c
NZ dlr/euro 0.4287 0.4275
NZ dlr/yen 54.60 54.55
NZ dlr/stg 38.62p 38.35p
NZ TWI 56.12 55.93
Aust dlr/US dlr 71.29c 71.18c
Euro/US dlr 1.3170 1.3140
US dlr/yen 96.73 97.12
- NZPA
