The New Zealand dollar fell after the Reserve Bank released information showing it is at a "very early stage" in refreshing its "unconventional monetary policy strategy."

The kiwi was trading at 67.31 US cents at 5pm in Wellington from 67.63 at 7:50am. The trade-weighted index eased to 73.66 points from 73.92.

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In response to an Official Information Act request from Bloomberg News, RBNZ said its work is at a very early stage and that it is withholding information relating to this to avoid "prejudice to the substantial economic interests of New Zealand and to maintain the effective conduct of public affairs through the free and frank expression of opinions by or between officers and employees of the Reserve Bank in the course of their duty."

"It's been very quiet over the last couple of days in the foreign exchange markets generally," says Robert Rennie, Westpac's Sydney-based chief currency strategist.


"In a fairly quiet market, it did feel like the news coming out of Bloomberg did have an impact" and the kiwi fell 30 or 40 basis points.

The market is awaiting the European Central Bank's latest monetary policy decision on Thursday – it is widely expected to announce further stimulus measures to combat stalling growth in the Eurozone.

And then next week, the Federal Reserve's Open Market Committee is expected to cut US interest rates by at least 25 basis points – it's a hot topic of debate as to whether the FOMC will cut the Fed funds rate by 50 points.

"It does feel like any or all information on monetary policy strategy" is keenly observed by currency markets, Rennie said. "With that as a backdrop, it's not surprising we've seen the New Zealand dollar underperforming."

The RBNZ cut its official cash rate in May to a record low at 1.5 per cent and market pricing suggests it will reach 1 per cent by year-end.

Earlier today, the Australian central bank's assistant governor Christopher Kent said the RBA stands ready to cut interest rates again if the Australian economy needs it. But he doesn't expect it to move to "quantitative easing," another name for printing money. Australia's cash rate currently stands at a record low at 1 per cent.

The New Zealand dollar was at 95.86 Australian cents from 96.13, at 54.03 British pence from 54.19, at 60.13 euro cents from 60.33, at 72.78 yen from 72.96 and at 4.6328 Chinese yuan from 4.6531.

The New Zealand two-year swap rate edged down to 1.3000 per cent from 1.3166 yesterday while the 10-year swap rate fell to 1.7225 per cent from 1.7575.