Dollar lower ahead of monetary policy statement

The New Zealand dollar consolidated at lower levels today after investors shunned speculative currencies again and as the focus turned to tomorrow's monetary policy statement from the Reserve Bank of New Zealand (RBNZ).

The NZ dollar was US70.83c at 5pm, little changed from US70.80c at 8am and down from US71.47c at 5pm yesterday.

Investors took profits on risky positions overnight, taking the NZ dollar as low as US70.56c, when the US dollar rose and equities markets fell on concern about debt levels in a number of countries. Sterling fell to an eight-week low against the dollar on worries about Britain's fiscal health.

Fitch cut Greece's credit rating at a time when investors are still worried about Dubai's debt woes. Moody's Investors Service further stoked unease when it said fiscal crises in a number of top-rated countries could last for "several years".

The NZ dollar was down to 62.63 yen at 5pm from 63.62 yen yesterday, reflecting the rise in the yen.

The NZ dollar was little changed at 0.4807 euro, and was at A78.08c against the Australian dollar from A78.13c yesterday. The trade weighted index fell to 63.65 from 64.01 yesterday.

The RBNZ is expected to hold its official cash rate at 2.5 per cent and investors are looking for any signals about when rates will rise.

- NZPA