The New Zealand dollar pared its decline after Fonterra Cooperative Group raises its forecast payout for dairy farmers to a record.
The kiwi climbed to US83.11 cents at 9am on Thursday in Wellington, from US82.90c at 8am and US83.30c at 5pm on Wednesday after Fonterra hiked its forecast pay-out to farmers by 35 cents to $8.65 per kilogram of milk solids to farmers in the 2013/14 season.
The dairy company held its forecast dividend of 10 cents per share.
Fonterra, the world's biggest dairy exporter, has raised its forecast pay-out as global demand for milk powders remains strong.
The local currency was weaker against the US dollar as investors favoured the greenback amid political tensions in Russia and the Ukraine and following a report that new home sales in the US surged to a five-and-a-half year high in January, easing concerns about a slowdown in the housing market.
"It was a night of USD strength, which gained against all the major currencies as well as a wide swathe of emerging market currencies," Bank of New Zealand currency strategist Raiko Shareef said in a note.
On Thursday morning, the New Zealand dollar touched a 10-day high of 92.69 Australian cents and was trading at A92.58c at 8am from A92.47c at 5pm on Wednesday.
The Australian currency has been under pressure this week following weakness in the Chinese yuan, as the Aussie is traded as a proxy for the Chinese currency which is not freely traded.
The kiwi dollar edged lower to 49.81 British pence from 49.95 pence, slipped to 85.01 yen from 85.28 yen and was unchanged at 60.63 euro cents.
The trade-weighted index weakened to 78.03 from 78.19.
Share
