The New Zealand dollar dipped following today's Reserve Bank interest rate call this morning but regained its footing later in the session.
The bank today left the Official Cash Rate (OCR) unchanged at 6.5 percent as widely expected but the kiwi still fell from US71.77c immediately before the 9am announcement to its low for the day of US71.34c half an hour later.
By 5pm the kiwi was buying US71.59c (from US71.21c at 5pm yesterday) having traded as high as US71.90c before the OCR.
ANZ dealer Glenn Mackersy said the main reason for the kiwi's reaction to the news was that Reserve Bank governor Alan Bollard's accompanying comments were "slightly less hawkish than the market was anticipating".
"As a result the kiwi sold off predominantly against the Australian dollar."
The kiwi was this evening buying A92.69c (A92.85c).
However the kiwi had found good support at the US70.30c to US70.40c level. Mr Mackersy said today's OCR "doesn't change anything fundamentally in the kiwi, it's still fairly strong".
Elsewhere, the greenback was at 103.21 yen (103.57), the euro was at $US1.3067 ($US1.2990), and the aussie was at US77.59c (US76.71c).
On the crosses the kiwi was buying 0.5479 euro (0.5483), 38.03 British pence (38.12), 73.87 yen (73.75), and 0.8470 Swiss francs (0.8484).
The New Zealand dollar trade-weighted index was at 69.48 (69.45), and the monetary conditions index was at plus 959 (960).
On the money markets, 90-day bank bill yields were at 6.78 percent (6.81), November 2006 bond yields were at 6.33 percent (6.35), July 2009s were unchanged at 6.10 percent, and April 2015s were unchanged at 6.03 percent.
- NZPA
<EM>Currency:</EM> Kiwi shuffles back following rate call sell down
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