The New Zealand dollar fell against its Australian counterpart after strong jobs data across the Tasman provided some tentative signs of wage inflation.
The kiwi traded at 91.15 Australian cents at 5pm in Wellington versus 91.46 Australian cents at 8am and 91.62 cent late yesterday. It was at 65.53 US cents from 65.10 US cents late yesterday.
Australia's unemployment rate was unchanged at 5.3 per cent, in line with economists' expectations. But the number of people employed rose by 44,000, beating an expected 18,000 increase, the Australian Bureau of Statistics said.
"The labour market is edging closer to the conditions that are necessary to trigger faster wage growth," said Capital Economics chief Australia and New Zealand economist Paul Dales.
He added, however, "it may be another couple of years yet before it gets there."
The kiwi lost ground against the Australian dollar but "I think the Kiwi-Aussie has been elevated for some time and was looking for a catalyst to move it," said Mark Johnson, a private client manager at OMF.
The kiwi gained against the greenback on improving risk appetite after overnight news that senior US officials led by Treasury Secretary Steven Mnuchin sent invitations to their counterparts in Beijing proposing another round of bilateral trade talks.
Johnson said that market is "really trading off hope" after the US offered the olive branch to China and on expectations that the US and Canada could also reach a deal on trade.
Looking ahead, he said markets will now be shifting attention to central bank rate decisions at the Bank of England and the European Central Bank, as well as US August CPI data.
The trade-weighted index was at 71.18 from 71.13 yesterday. The kiwi traded at 4.4868 Chinese yuan from 4.4795 yuan yesterday and at 73.03 yen from 72.71 yen yesterday. It was at 56.33 euro cents from 56.25 cents and at 50.23 British pence from 50.06 pence yesterday.
New Zealand's two-year swap rate fell 1 basis point to 1.97 per cent while 10-year swaps fell 1 basis point to 2.81 per cent.