Friday in Asia, the New Zealand dollar plummeted against its major counterparts as Asian equities extended a global slump, reducing demand for higher-yielding currencies.
The NZ dollar plunged to a 2-week low against the greenback and the euro, 17-day low against the yen and a 1-week low against the aussie.
Asian stock markets are mostly trading in the red with notable losses today with the overnight negative close on Wall Street on the back of some disappointing job reports hurting sentiment to a significant extent.
With doubts about the pace of economic recovery surfacing again, investors seem quite reluctant to go in for any big buying, and are in fact, looking to trim down positions substantially.
Australia's S&P/ASX 200 index dropped 1.4% and the broader All Ordinaries index fell 1.3%. New Zealand's NZX-50 index declined 0.9%, Japan's Nikkei 225 index lost 1%, Hong Kong's Hang Seng slipped 0.7% and China's Shangai Composite index dipped 0.4%.
Adding to kiwi's slide, the Reserve Bank of New Zealand report said that total credit card billings in New Zealand fell a seasonally adjusted 0.4% year-on-year in October after the 2.3% decrease in the previous month. This is the eleventh annual decline recorded in credit card billings in the past 12 months.
On a monthly basis, total card billings were up 0.2% in October, rebounding from the 1% decrease in the prior month.
New Zealand's central bank should leave its benchmark interest rate at a record low to help a recovery from the worst recession in three decades, the Organization for Economic Cooperation and Development said yesterday.
"Given weak and fragile private demand, it is appropriate that monetary and fiscal policies remain expansionary for the time being," the OECD said in its Economic Outlook, released in Paris yesterday.
Central bank Governor Alan Bollard has kept the official cash rate at 2.5 percent since April and last month said he expects to leave borrowing costs unchanged until the second half of 2010 because the economy needs stimulus.
New Zealand's recovery may be slow because consumers are reluctant to spend and manufacturers are battling to cope with a soaring currency.
The New Zealand dollar, which closed yesterday's trading at 0.7314 against the U.S. currency fell to a 2-week low of 0.7261 in early Asian deals on Friday. On the downside, 0.710 is seen as the next target level for the NZ dollar.
The kiwi-greenback pair tumbled to a 1-month low of 0.7086 on November 02. Although the kiwi gained 6% thereafter, it pulled back again after reaching a 3-week high of 0.7528 on November 16. Since then, the NZ currency has lost more than 3%.
During early Asian deals on Friday, the New Zealand dollar slipped to 64.50 against the Japanese yen. This set the lowest point for the kiwi since November 03. If the NZ dollar weakens further, it may target the 63.9 level. At yesterday's close, the kiwi-yen pair was quoted at 65.11.
Today, the policy board of the Bank of Japan unanimously decided to retain the overnight call rate at 0.1%, in line with the expectations of economists. The last change in the rate was a 0.1% cut in interest rates at the December 2008 meeting.
In an accompanying statement, the central bank said, "Japan's economy is picking up mainly due to various policy measures taken at home and abroad, although the momentum of self-sustaining recovery in domestic private demand remains weak. In the conduct of monetary policy, the bank will aim to maintain the extremely accommodative financial environment."
After touching a 1-month low of 63.26 against the yen on November 02, the kiwi advanced 6% and reached an 11-day high of 67.14 on November 09. Thereafter, the kiwi-yen pair moved sideways in the subsequent days but fell sharply yesterday after the disappointing U.S economic data on Wednesday raised doubts about the strength of economic recovery in the world's largest economy.
Adding to kiwi's slide, media reports said yesterday that New Zealand's main opposition Labour Party will no longer support the central bank's primary policy of targeting inflation, saying it wants a competitive exchange rate and lower borrowing costs.
The New Zealand dollar plunged to a 1-week low of 1.2634 against the Aussie in early Asian deals on Friday. The next downside target level for the kiwi is seen at 1.266. The aussie-kiwi pair was worth 1.2576 at yesterday's close.
The kiwi has dropped more than 1% against the aussie from a 13-day high of 1.2450 hit on November 17.
In early Asian deals on Friday, the New Zealand dollar slumped to a 2-week low of 2.0513 against the euro. If the kiwi drops further, it may likely target the 2.071 level. The euro-kiwi pair closed Thursday's trading at 2.0414.
The NZ dollar has been in a downward channel against the euro after it reached a 3-week high of 1.9928 on November 18. Since then, the kiwi has depreciated 3%.
In the upcoming European session, the German PPI for October and the Italian industrial sales report for September are expected.
There are no significant economic reports scheduled for release from the U.S. today.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.