The New Zealand dollar was little changed in the wake of the US Federal Reserve's first interest rate cut in more than a decade and as the market continues to expect a rate cut from our own Reserve Bank next week.

The kiwi was trading at 65.57 US cents at 5pm in Wellington, above the day's low at 65.32 cents, but down from 65.62 this morning. The trade-weighted index was unchanged at 72.43 points.

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Fed chair Jerome Powell helped create some confusion by saying at first that the rate cut was a "mid-cycle adjustment" and an insurance policy to keep the long expansion since the GFC going, rather than the start of an easing cycle, even though central banks rarely move just once in either direction.

Powell later said the Fed is still ready to cut rates again if necessary.

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Some slammed Powell for giving into pressure from US President Donald Trump, who complained after the cut that it wasn't enough, even though markets have been anticipating the move for weeks.

But Robert Rennie, chief currency strategist at Westpac in Sydney, says he thinks that judgement is too harsh.

"There's probably something to be said for the fact that here we are, x number of years into an expansion, and we still haven't got to the point of generating inflation" or of seeing significant upward pressure on wages in the US, Rennie says.

"I think it's fair to say financial conditions got too tight late last year." The Fed hiked rates four times in 2018 and nine times since December 2015.

As well as cutting rates now, the Fed has also given up trying to unwind its balance sheet, effectively reversing all the money printing it did since the GFC.

Rennie says Westpac still expects one more cut from the Fed. However, it expects the non-farm payroll figures for July, due on Friday, will show 180,000 jobs were created compared with 224,000 in June.

"That's hardly a household or employment sector that needs further monetary policy stimulus," he says.

The New Zealand dollar was at 95.72 Australian cents from 95.92, at 54.04 British pence from 53.98, at 59.32 euro cents from 59.27 at 71.57 yen from 71.46 and at 4.5227 Chinese yuan from 4.5175.

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The New Zealand two-year swap rate rose to a bid price of 1.2411 per cent from 1.2150 yesterday while the 10-year swap rate eased to 1.6325 per cent from 1.6350.