The New Zealand dollar fell to multi-week lows against a range of currencies today after US President Barack Obama proposed the biggest regulatory crackdown on banks since the 1930s.The plan to ban banks from proprietary trading, and owning, investing in
The New Zealand dollar fell to multi-week lows against a range of currencies today after US President Barack Obama proposed the biggest regulatory crackdown on banks since the 1930s.
The plan to ban banks from proprietary trading, and owning, investing in or sponsoring hedge funds and private equity groups knocked stock markets and increased investor anxiety.
"It really set the cat amongst the pigeons. Equity markets fell quite sharply and that saw risk appetite come off the boil and growth sensitive currencies sold heavily," said Danica Hampton, senior currency strategist at BNZ.
The NZ dollar traded just below 71USc today, its lowest since December 29, before settling at 71.30USc at 5pm from 72.09USc at the same time yesterday.
International developments such as the bank regulations story are expected to dominate markets for several days but the focus next week will turn to the Reserve Bank's official cash rate review on January 28.
The bank is expected to keep rates on hold after Consumer Price Index data for the December quarter was lower than expected.
"I think the CPI set the scene and it does suggest there is no urgency," Ms Hampton said.
The NZ dollar was €0.5046 at 5pm, which is around a two-and-a-half-week low and compared with €0.5115 at 5pm yesterday.
The kiwi fell to ¥64.04 from ¥65.97 yesterday and was 78.86Ac against the Australian dollar from 79.01Ac yesterday.
The trade weighted index was 65.04 from 65.83 yesterday.
