The New Zealand dollar was stalled as investors eye the escalating sabre-rattling between the US and China. Trading was also subdued with both the US and British economies on holiday later today.
The kiwi was trading at 60.97 US cents at 5pm in Wellington after ending Friday in New York at 60.96 cents, just a pip below the local close. The trade-weighted index was at 69.04 from 68.94.
Over the weekend, China's Foreign Minister Wang Yi accused the US of spreading "conspiracies and lies" about the origins of covid-19 and that the US has been infected by a "political virus."
That's because US President Donald Trump has claimed without evidence that the virus had escaped from a Chinese laboratory – his own intelligence officers have said the virus developed naturally and that there was no evidence it was man made.
Also over the weekend, Trump's national security adviser, Robert O'Brien, compared China's handling of the pandemic with the former Soviet Union's response to the Chernobyl nuclear power station disaster in 1986.
"The cover-up that they did of the virus is going to do down in history along with Chernobyl," O'Brien told NBC.
He also threatened China with trade sanctions if it goes ahead with new security legislation planned for Hong Kong, a threat that Wang said was pushing the two countries "to the brink of a new Cold War."
"All the currencies are doing very little. Everyone's watching what happens with the US and China and Australia," said Pat Gilligan, a director at Forex.
China has imposed an 80 percent tariff on Australian barley and banned imports from four major Australian meat works and has even been rumoured to have told state-owned power stations to avoid buying new shipments of Australian coal.
That is believed to be in exchange for Australia's early support of an independent inquiry into the origins of covid-19.
"Some of the comments over the weekend were pretty sharp from both sides but it doesn't seem to have impacted the kiwi or Aussie yet," Gilligan said.
The New Zealand dollar was trading at 93.27 Australian cents at 5pm from 93.24 cents at the same time on Friday. It was at 50.07 British pence from 49.95 pence, at 55.98 euro cents from 55.80 cents, at 65.63 yen from 65.51 yen and at 4.3522 Chinese yuan from 4.3396 yuan.
The bid price on the two-year swap rate closed at 0.1700 percent from 0.1475 percent on Friday, while 10-year swaps were at 0.5975 percent from 0.5825 percent.
