09 June 2009

Source: stuff.co.nz

The New Zealand dollar fell to its lowest level in almost a fortnight against the greenback, which extended gains following last week's United States jobs data.

By 8am the NZ dollar was buying US61.99c, having dipped to around US61.50c early today, from US62.83c at 5pm yesterday.

ANZ bank said the NZ dollar was being driven by offshore forces.

That was seen overnight with the US dollar again finding support and the euro facing selling pressures as Ireland's sovereign credit rating was downgraded by Standard & Poor's.

ANZ said it doubted domestic factors this week, including the Reserve Bank's interest rate decision on Thursday, would have too much influence on currency markets,

The kiwi fell against a range of currencies. By 8am it was down to 0.4459 euro from 0.4491 at 5pm, and fell to 61.04 yen from 61.80.

The NZ dollar edged down to A78.68c against its Australian currency, while the trade weighted index fell to 59.23 at 8am from 59.81 at 5pm.

The cut to Ireland's credit rating provided a fresh catalyst to sell the euro, which at one stage fell to US$1.3806, almost a two-week low.

It also helped the US dollar, which rallied since Friday after data showed the United States lost fewer jobs than expected in May. That triggered speculation the Federal Reserve may raise US interest rates next year, pushing two-year government note yields to a seven-month high.