The New Zealand Dollar fell overnight, despite a rise in United States share prices, leading the ANZ bank to question whether the currency was getting set for a "roller coaster" ride down.
From US64.44c at 5pm yesterday, the kiwi was down to US63.91c at 8am today, and also fell briskly against other major currencies.
The de-linking of the NZ dollar from US equities and the US dollar may be a sign that offshore participants were finally becoming attuned to domestic factors, ANZ said.
The bank pointed to ongoing declines in world dairy prices, at the same time as the NZ dollar was doing the export sector no favours, and while the household sector was deleveraging.
The prospects of a significantly lower dairy payout appeared to have finally caught the attention of offshore players, ANZ said.
Large NZ dollar denominated bond maturities this month were yet another negative factor weighing on the kiwi.
"Throw in the fact that speculative positioning is significantly long in the NZD, and we wonder whether this is the long kiss goodnight and we are getting set for the roller coaster ride down."
The NZ dollar was down to 0.4519 EURO at the local open from 0.4592 euro at 5pm, and was also down to 61.76 Yen from 62.40.
Against the Australian dollar the kiwi fell to A79.19c at the local open from A79.95c, while the trade weighted index fell to 60.20 at 8am from 60.89 at 5pm.
The US dollar dropped to its lowest in more than three weeks against the euro, pressured by news China has asked to debate proposals for a new global reserve currency at next week's Group of Eight summit.
Gains in global stocks as well as improved manufacturing activity data in Europe and China have also hurt demand for the US dollar as a safe haven.