The New Zealand dollar fell when Asian markets opened and investors started selling gold, silver, riskier currencies such as the kiwi and Aussie dollars and crypto-currencies.
The kiwi was trading at 66.58 US cents at 5pm in Wellington, down from the day's high at 67.02 cents and 66.74 cents at the same time yesterday. The trade-weighted index was at 72.55 from 72.76.
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"All of a sudden in the Asian session we've seen everything get dragged down," said Tim Kelleher, head of foreign exchange sales at Commonwealth Bank of Australia.
"It scared the bejesus out of everyone who was trading on the wrong side. Certainly, the way the markets reacted, it was someone pretty large."
Kelleher said it looked like book-squaring ahead of the Federal Reserve's latest monetary policy meeting later this week and earnings reports from a number of multinational companies, including technology heavyweights such as Amazon, Apple and Alphabet, the parent of Google.
According to Bloomberg, investors are betting that setbacks in the global fight against Covid-19 will push Federal Reserve chair Jerome Powell to signal that US interest rates will stay near zero for longer and that it will have to keep its printing presses rolling.
Investors are also eyeing the divisions between US lawmakers on further fiscal spending to support the economy just as existing stimulus measures are expiring.
Data on US GDP is also due on Thursday and economists are expecting it to show an unprecedented 33 per cent June-quarter contraction in the wake of shutdowns to try to stop Covid-19 from spreading.
The kiwi traded at 93.21 Australian cents from 93.55 cents at 5pm yesterday, at 70.27 yen from 70.47 yen, 56.73 euro cents from 57.01 cents, 51.78 British pence from 51.99 pence, and 4.6623 Chinese yuan from 4.6717 yuan.
The bid-price on the two-year swap rate was at 0.1950 per cent from 0.1800 per cent yesterday while the 10-year swap was at 0.6930 per cent from 0.6500 per cent.