The New Zealand dollar was under pressure today, hitting a decade low against its Australian counterpart and touching its lowest level against the greenback since early October even though dairy prices rose 2.4 per cent in Fonterra's latest online auction.
The NZ dollar wilted after breaking key technical levels and
as speculators cut out so-called long positions by selling the NZ dollar before the end of the year.
While data on the economy continues to be underwhelming ahead of next week's September quarter gross domestic product report.
Today business confidence was slightly weaker in the closely watched National Bank Business Outlook report and the Westpac McDermott Miller consumer confidence index fell 5.8 points to 108.3 in the December quarter, its second consecutive decline.
The NZ dollar was at US73.88c at 5pm from US74.15c at 8am and US74.92c at 5pm yesterday. It traded as low as US73.73c, its lowest level since early October.
Against the Australian dollar, the NZ dollar fell below A75c for the first time since 2000. By 5pm it was buying A74.87c from A75.06c at 8am and A75.27c at 5pm yesterday.
BNZ currency strategist Mike Jones said the fall against the aussie came amid ongoing selling interest from momentum and speculative type players.
Also NZ-US three-year swap spreads slipped to the lowest level since April, undermining yield support for the NZ dollar.
Not even a solid result at the overnight Fonterra milk price auction, where prices were up 2.4 per cent on a fortnight earlier, could prop up the ailing NZ dollar, Mr Jones said.
The US dollar was bolstered by data showing a steady recovery in New York state's manufacturing sector.
The NZ dollar is around fortnight lows against the Japanese currency, and buying 62.21 yen at 5pm from 62.78 yen yesterday.
The NZ dollar fell to a six-week low around 0.5565 euro on Wednesday night and by 5pm was at 0.5589 euro from 0.5611 at the same time yesterday.
The trade weighted index fell to 66.93 at 5pm from 67.44 yesterday.
- NZPA
