The dollar was see-sawing yesterday as the market looked for clear signals that failed to appear.
The kiwi closed at 42.99USc, up from 42.89USc in the morning. The Australian dollar was at 52.49USc, one pip above its New Zealand opening price.
The kiwi languished within a 25-point range yesterday - 42.85USc to
43.10USc - as sustained one-off flows pushed it first one way, then the other.
The euro failed to hold on to overnight gains despite good economic data from Europe.
The euro rallied overnight after the German Ifo business climate index rose for the first time in eight months, soothing concerns about a steep slowdown in the euro zone economy.
In the US overnight, the US Labour Department said that consumer prices shot up 0.6 per cent last month, the biggest increase in 10 months, reflecting a surge in natural gas prices.
The January increase, which followed three straight monthly gains of a moderate 0.2 per cent, was double what economists had been expecting.
Some commentaries even raised the spectre of stagflation in the US, a scenario of zero growth doubled with inflation.
A lack of clear signals from the US, which has a continuing question mark over its economy, kept the kiwi guessing, one dealer said.
"When we opened up everybody was a bit confused, really. There should have been quite clear signals there and in fact the reverse happened.
"One-off flows ruled the day. Locals were really a little bit reluctant to hold on to stuff.
"Sentiment really changes very rapidly these days - everyone's looking for the turn in the US economy, we keep getting mixed signals, so one day everyone's bullish on the US dollar, and the next day everyone's bearish.
"We're languishing really."
- NZPA
