The New Zealand dollar fell from a five-month high as investors grew wary of the US-China agreement to cool trade tensions and US President Donald Trump kept the door open to more tariffs.

The kiwi declined to 69.28 US cents as at 8am from 69.54 cents yesterday. The trade-weighted index was at 75.16 from 75.40 yesterday.

Stocks on Wall Street fell, with the Dow Jones Industrial Average down 2.5 per cent in afternoon trading, as a lack of detail about how China and the US will find common ground in their trade dispute created uncertainty for investors. Trump fuelled those concerns when he tweeted that if a deal can't be reached with his Chinese counterpart, Xi Jinping, he is ready to impose tariffs. Analysts fear the trade tensions between the two nations will slow global growth, which would weigh heavily on trade-dependent nations such as New Zealand.

"Murky details around the Trump-Xi trade truce alongside Trump talk of being a 'Tariff man' has seen it ease off resistance," ANZ Bank New Zealand economists Miles Workman and Philip Borkin said in a note on the kiwi dollar. "With global sentiment turning weaker, it will likely be a struggle to push higher today."

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The gloomier investor sentiment outweighed a gain in dairy prices at the latest GlobalDairyTrade auction. The GDT price index rose 2.2 per cent, with whole milk powder prices up 2.5 per cent at US$2,667 a tonne. Increased global supply and strong New Zealand production, in particular, have weighed on prices in recent months. Despite the increase, economists anticipate Fonterra Cooperative Group will lower its forecast payout to farmers in this week's quarterly review.

Quotable Value data this morning showed New Zealand property values rose 3.5 per cent in the year through November. Statistics New Zealand will release third-quarter building work figures at 10.45am.

The latest annual CoreLogic QV House Price Index information came out today.

The kiwi was unchanged at 94.39 Australian cents and fell to 4.7355 Chinese yuan from 4.7652 yuan. It dropped to 78.10 yen from 78.78 yen yesterday and traded at 61.09 euro cents from 61.16 cents.

The local currency decreased to 54.46 British pence from 54.60 pence yesterday after the UK Parliament found Theresa May's government in contempt for refusing to publish legal advice underpinning the Brexit plan.

Will local stocks drop?

Milford Asset Management investment analyst Stephanie Perrin says it's unlikely that the local market will come through the battle of the superpowers unscathed.

"For New Zealand, it's more of a sentiment issue as opposed to directly impacting company earnings or the economy," Perrin said.

In general, our listed companies aren't part of supply chains that produce Chinese goods to be exported to the US. But we do have companies like a2 Milk and NZ King Salmon, so to the extent that the Chinese consumer feels a squeeze on their disposable income, we may see an impact."

There were also concerns beyond the trade battle between Trump and China.

"More broadly, the slowdown in global economic growth which is already making itself felt, will likely impact NZ exporters generally, as well as possibly impacting more cyclical companies like Air New Zealand."

- BusinessDesk