Dollar hits eight month low

 

dollar downThe Australian dollar has hit a fresh eight month low after the Reserve Bank of New Zealand tried to talk down its own currency.

At 0700 AEST on Friday, the local currency was trading at 87.87 US cents, down from 88.05 cents on Thursday.

The currency fell as low as 87.74 US cents overnight, its lowest level since February 4, following the comments from the RBNZ.

The bank’s governor, Graeme Wheeler, said the currency’s strength was “unjustified and unsustainable” given the decline in commodity prices.

The comments sent the kiwi tumbling, dragging the Australian dollar with it.

At 0700 AEST, the kiwi was trading at 79.24 US cents.

“It is the dramatic move lower in the NZ dollar that is the standout story in foreign exchange of the past 24 hours,” National Australian Bank global co-head of FX strategy, Ray Attrill, said.

“(The moves were) sparked by the RBNZ’s aggressive outpouring of angst at the `unjustified and unsustainable’ level of the currency, which inflicted some collateral damage on the Australian dollar.”

AAP

You have 7 articles remaining. Unlock 15 free articles a month, it’s free.