The New Zealand dollar pared some of its overnight losses against the greenback as risk aversion eased slightly in Asian trading although investors remain jittery about a possible global trade war.

The kiwi dollar traded at US72.26c this afternoon from US72.17c at 8am and US72.34c late yesterday. The trade-weighted index was at 74.20 from 74.19.

The kiwi eased overnight after China retaliated over US tariffs, sapping risk appetite. US equity markets also sold off sharply as China said it would impose tariffs of up to 25 per cent on a list of 128 products imported from the US.

ANZ Bank New Zealand chief economist Sharon Zollner said "it wasn't surprising overnight to see the New Zealand dollar take a bit of a hit. We have been saying for quite some time that its vulnerable to a bit of a turn in global liquidity and more generally in risk aversion and we did see a risk-off move", she said.

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She said it has bounced back a bit in Asian trading "consistent with a bit of a bounce in US equity futures, as some may see the move as a bit overdone".

Westpac Banking Corp market strategist Imre Speizer said the kiwi "is still following the US dollar more than anything else".

He noted, however, that while risk appetite has ticked up a bit on the day and the S&P futures have "bounced a bit, they are still lower than they were 12 hours ago".

The kiwi traded at A93.94c from A94.16c late on Tuesday as the Aussie benefited from the tick up in risk appetite slightly more than the kiwi did. He said there was little market reaction after the Reserve Bank of Australia kept rates on hold at a record low 1.50 per cent and published a statement that was in line with expectations.

The New Zealand dollar fell to 76.55 yen from 76.89 yen late on Tuesday and traded at 58.70 euro cents, unchanged from yesterday and rose to 5.5428 yuan from 4.5376 yuan. It declined to 51.39 British pence from 51.59 pence yesterday.

New Zealand's two-year swap rate rose 1 basis point to 2.22 per cent and the 10-year swap rate rose two basis points to 3.06 per cent.