The New Zealand dollar fell to a 15-month low against the euro after European Central Bank president Mario Draghi failed to mention the currency's strength in a speech at Jackson Hole as some market commentators had predicted while Federal Reserve chair Janet Yellen avoided the topic of monetary policy.
The kiwi dollar traded at 60.51 euro cents as at 8am in Wellington, having touched 60.43 cents this morning, the lowest since May last year, from 60.67 cents in New York on Friday. The kiwi has shed about half a euro cent from where it was in Wellington at the end of last week. The local currency traded at 72.36 US cents from 72.38 cents in New York and up from 72.03 cents in Wellington on Friday.
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The euro gained to its highest level in two years against the greenback following Draghi's speech at the central bankers' symposium, where he talked broadly about risks to free trade. Traders had been speculating that both Draghi and Yellen may give clues to the direction of monetary policy and when they didn't, the market drove up the euro. TD Securities said in a note that "by failing to discuss the elephant(s) in the room - inflation and rate normalisation", Yellen's speech was "taken as dovish."