Forex - Kiwi down a tad as RBNZ holds interest rates steady at 3.5%

Investing.com - The New Zealand dollar fell as the Reserve Bank of New Zealand kept its Official Cash Rate steady at 3.5% on Thursday as expected and signaled a more gradual rise in interest rates.

"Growth is expected to remain at or above trend through 2016, with unemployment continuing to decline. Modest inflation pressures suggest the expansion can be sustained for longer than previously expected with a more gradual increase in interest rates," Wheeler said.

NZD/USD traded at 0.7814, down 0.05%. AUD/USD traded at 0.8316, down 0.01%, while USD/JPY changed hands at 117.95, up 0.10%.

In Japan core machinery orders are due at 0850 Tokyo (2350 GMT) with a fall of 1.9% expected month-on-month. Later in Australia, comes jobs data with the unemployment rate seen at 6.3% in November from 6.2% in October and 12,400 jobs added in the month.

Overnight, the dollar edged lower against most major currencies on Wednesday after investors flocked to the yen on concerns China's economy may grow less than expected going forward, though losses were seen as short-lived on concerns the European crisis may return.

The yen rose on jitters over the outlook for China’s economy after Beijing set new restrictions on collateral for short-term loans.

The move fueled fears that the China may grow less than anticipated, which fueled safe-haven yen positions that came at the greenback's expense.

The yen often rises when Japanese stocks fall and growth-sensitive Australian and New Zealand dollars slide, and the yen's advance brought the euro and others up with it on Wednesday.

Markets were spooked by the risk of snap elections, which could take place if Prime Minister Antonis Samaras’s candidate is not approved by parliament, which could see the anti-bailout Syriza party take power.

The US dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was down 0.03% at 88.23.

On Thursday, the U.S. is to release data on retail sales, the government measure of consumer spending, as well as the weekly report on jobless claims.