The New Zealand dollar shed nearly 1 percent on Tuesday after a report that the United States had stopped importing kiwi-fruit vine from New Zealand, giving investors a reason to sell into the currency's recent rally. Against the US currency, the Australian dollar slipped to $1.0087, from $1.0142 late in New York. It breached $1.0080 in early Asian trade but found a floor at $1.077, with solid support around $1.0000/10.
The New Zealand dollar lost 0.9 percent to fall to the day's low of NZ$0.7805, with charts suggesting it could extend its fall to $0.7700. The New Zealand dollar had leapt 3.7 percent last week to 31-month highs of $0.7975, its biggest weekly gain in 18 months.
Traders cited a recent strong run of New Zealand data, especially Thursday's jobs report, that hardened bets for New Zealand rates to rise to 3.25 percent in March, from 3 percent now. Against the euro however, the Australian and New Zealand dollars held close to two-month highs as European debt woes gave investors a reason to cut stretched positions across currencies.
The euro fell as far as A$1.3687, a level last seen on September 13, and threatening a record low of A$1.3654 that was also last seen on September 13. In New Zealand dollars, the euro eased to a low of NZ$1.7587, near a two-month trough of NZ$1.7576 hit on Friday.