The New Zealand dollar held near the bottom end of its recent trading range as investors weighed up whether the Reserve Bank will cut interest rates to further stimulate a slowing economy.

The kiwi traded at 73.33 US cents at 5pm in Wellington from 73.15 cents at 8am and down from 73.60 cents yesterday.

The trade-weighted index fell to 75.93 from 76.20 yesterday.

Traders have priced in 48 basis points of cuts to the 3.5 percent official cash rate over the coming 12 months, according to the Overnight Index Swap curve, as globally low inflation and a slowing economy stoke expectations the Reserve Bank may need to prop up growth.


At the same time, US economic data has been recovering from a slowdown in the first three months of the year, and upcoming speeches from Fed chair Janet Yellen and her deputy Stanley Fischer will be watched for any clues on the central bank's thinking about US growth.

"We're stuck in the bottom of the range because of speculation of RBNZ rate cuts, to the extent that the market has fully priced in a 25 point cut by July," said Raiko Shareef, currency strategist at Bank of New Zealand in Wellington.

"Nearer term, we're looking to US data more and the comments from Fed deputy chair Fischer and chair Yellen tonight and tomorrow night respectively."

The New Zealand government announced its 2015 Budget today, detailing a $3.2 billion reduction to the Crown's operating balance compared to its December half-year projection, and forecasting a wider deficit in the 12 months ending June 30 than previously thought, before turning a smaller surplus in 2016.

The New Zealand Debt Management Office lifted forecast bond issuance by $1 billion to meet a bigger cash shortfall than expected, and the budget wasn't seen as impacting the Crown's sovereign credit rating by agencies Standard & Poor's or Moody's Investors Service.

BNZ's Shareef said the budget offered few surprises and didn't really impact on the currency today.

Government figures showed inbound migration rose to a new record, with a net gain of 56,800 migrants in the year ended April 30, more than the 56,600 peak forecast by the Treasury's central projection in today's budget in June.

If migration tracks ahead of the Treasury's forecasts, the government's financial adviser outlined a scenario for increased consumer spending and housing demand, creating inflationary pressures.


New Zealand's two-year swap rate edged down to 3.36 per cent at 5pm in Wellington from 3.37 per cent yesterday, while the 10-year swap rate decreased to 3.97 percent from 4 percent.

The kiwi declined to 92.91 Australian cents at 5pm in Wellington from 92.91 cents yesterday, and fell to 4.5483 Chinese yuan from 4.5649 yuan.

It slipped to 65.92 euro cents from 66.12 cents yesterday, and dropped to 47.14 British pence from 47.47 pence. The kiwi decreased to 88.79 yen from 89.03 yen yesterday.