NZ dollar falls

NZPA

Monday 22nd August 2011

The New Zealand dollar fell as major sharemarkets around the world dropped further.

At 8am today the kiwi was buying US81.78c -- near 1-1/2-week lows reached on Saturday -- down from US82.17c at 5pm on Friday.

At 0.5687 euro at 8am today, the NZ dollar was also near Saturday's 1-1/2-week low against the European currency, having fallen from 0.5738 euro at 5pm on Friday.

ANZ bank said an initial positive start by the NZ dollar to the overnight Friday session had been quickly eradicated as global equity markets melted further.

The NZ dollar was likely to head lower to start off the week, with minor support levels likely to be taken out in early trading as currency markets braced for the opening of Asian equity markets.

The US dollar plumbed a record low against the yen after a Wall Street Journal report cited Japan's top currency official saying Japanese authorities do not plan to intervene often.

Growing volatility in global markets also raised investors' appetite for the yen, a traditional safe-haven currencies, and the Swiss franc.

The euro was also boosted by market chatter that the European Central Bank was buying peripheral bonds.

The NZ dollar dropped from 62.84 yen at 5pm on Friday to a one-week low around 62.45 yen on Saturday, and was at 62.70 at 8am.

Against the Australian dollar the kiwi dropped from A79.22c on Friday evening to a six-week low around A78.40c on Saturday, and at 8am today was buying A78.75c. The trade weighted index was down to 70.30 at 8am today from 70.76 at 5pm on Friday.

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