The New Zealand dollar held its gains but came off its highs as the rally in US equities markets appeared to run out of puff.
The kiwi was trading at 64.17 US cents at 5pm in Wellington, off the high at 64.45 cents early this morning but little changed from 64.10 cents at the same time yesterday.
The trade-weighted index was at 71.36 from 71.14.
"Sometimes the market just needs to correct – it's gone up too far, too fast," said Philip Poppe, a director at Forex. The currency fell below 60 US cents in mid-May.
US equities futures eased a little today after the key indices reached their highest levels in three months as investors bet on that economy recovering quickly as lockdowns ease.
The kiwi has been closely following the fortunes of equities markets of late because the usual measure, relative interest rates, has become meaningless in a world where central banks, including New Zealand's, are printing money.
"It's the unintended consequence of flooding a market with cash at zero per cent – it's got to go somewhere. It's not going to go into housing, bond rates are already near nil," he said.
"Gold, which often attracts money in times of strife, is already highly-priced, so the money is going into equities, almost by default."
Poppe said the market was wondering whether the rally in US equities was sustainable and "is the market going to continue to ignore what's happening in the economy and just keep pushing asset prices up?"
Ironically, the market took a report showing 2.76 million jobs in the private sector were lost in the US in April as good news – economists had been forecasting a 9 million drop.
The market is also looking ahead to Friday's official US jobs report, the non-farm payrolls, which economists are expecting to show an 8 million fall for May after declining more than 20 million in April. They expect the US unemployment rate will climb to 19.5 per cent from 14.7 per cent.
Poppe said the market was also wondering how long traders could ignore the worsening civil unrest in the US sparked by the killing by police of an unarmed black man which was captured on video.
And tensions between the US and China continue to simmer away in the background.
The New Zealand dollar was trading at 92.91 Australian cents from 92.44 cents yesterday. It was at 51.16 British pence from 50.92 pence, unchanged at 57.20 Euro cents, at 70.01 yen from 69.56 yen, and at 4.5727 Chinese yuan from 4.5583 yuan.
The bid price on the two-year swap rate was unchanged at 0.2100 per cent, while 10-year swaps were at 0.7775 per cent from 0.7900 per cent yesterday.