6 Aug 2014

Kiwi slides in wake of dairy auction

8:20 pm on 6 August 2014

The New Zealand dollar exchange rate dropped almost US1 cent on Wednesday following a larger than expected fall in prices at the dairy trade auction in the early hours of the day.

Dairy prices fell 8.4 percent in that Global Dairy Trade auction.

The senior client advisor, at Bancorp Treasury Services, Peter Cavanaugh said the dollar had broken through key support levels and further weakness was expected.

At the end of the local business day, the kiwi was trading at 84.33 US cents, 90.64 Australian cents, 49.97 British pence, point-6308 euro, 86.47 yen and 5.20 renminbi.

300114. Photo Diego Opatowski / RNZ. dOLLAR DOWN

Photo: RNZ

The sharemarket also fell, with the benchmark Top 50 Index finishing down 12 points at 5092.

The director of wealth management at Murray & Co, Johnny Cochrane, said the market was weaker, but Fonterra's share price benefited from the fall in dairy prices.

Fonterra's share price rose 10 cents to $6.20

Fisher & Paykel rose 5 cents to $4.80

Xero, fell $1.10 to $23.90