The New Zealand dollar tumbled on Wednesday after the country’s central bank warned it may have to intervene to weaken the currency, while the U.S. dollar languished at six-month lows against a basket of major currencies.
Reserve Bank of New Zealand Governor Graeme Wheeler said if the currency stayed high in the face of worsening fundamentals, “it would become more opportune for the Reserve Bank to intervene in the currency market to sell NZ dollars.”
The kiwi dropped more than half a U.S. cent on his comments, falling as far as $0.8693 from $0.8770 in early trade. It was last at $0.8707, having erased almost all of its overnight gains.
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