The New Zealand dollar fell to its lowest level in nearly four weeks against the greenback, which had its best week against major currencies in nearly two years.

The continuing rise of the greenback came as a lacklustre Italian debt sale and tepid consumer data in the United States fed fear that slower US growth would hurt the world economy.

By 8am today, the kiwi was buying US70.56c, down from US71.41c at 5pm on Friday, and after having dropped as low as US70.45c early Saturday.

The euro fell to a three-week low against the US currency as spreads between peripheral European and benchmark German government bonds widened. Analysts said weak demand for Italian five- and 15-year bonds renewed fear about euro zone deficits.

US data showing a smaller-than-expected rebound in July retail sales and consumer inflation at its lowest level since the 1960s also added to recent evidence that the US economy has slowed considerably.

The fear, analysts say, is that if the US economy slows enough, demand for Chinese goods and for the bonds of indebted euro zone countries such as Greece and Spain could dwindle.

BNZ markets strategist Mike Jones said the NZ dollar tumbled against the greenback last week as it faced twin headwinds of rising global risk aversion and reduced yield support.

The kiwi also fell to its lowest level against the Australian dollar in more than three months, dropping to around A78.85c early Saturday. By 8am today the NZ dollar was at A79.01c, down from A79.28c at 5pm on Friday.

ANZ bank said market positioning should slow the descent of the cross against the aussie but not prevent it.

"Markets realise the Australian economic landscape and yield advantage continue to hold the attention of investors and justify a move lower," ANZ said.

The kiwi also slipped to 0.5527 euro at 8am today from 0.5555 at 5pm on Friday, and was down to 60.82 yen from 61.46. The trade weighted index was 66.12 at 8am from 66.70 at Friday's local close.