Investing.com - The New Zealand dollar edged up against its U.S. counterpart on Thursday, but remained close to a four-year low after the Reserve Bank of New Zealand held interest rates, while the U.S. Federal Reserve indicated that interest rates could start to rise around mid-year.
NZD/USD hit 0.7348 during early European trade, the session high; the pair subsequently consolidated at 0.7323, adding 0.10%.
The pair was likely to find support at 0.7113 and resistance at 0.7494, Wednesday's high.
The New Zealand dollar dropped to a four-year low against the greenback after the RBNZ held its benchmark interest rate at a record-low 3.50% and signaled that it is prepared to lower borrowing costs further as plunging oil prices dampen inflation.
"Future interest-rate adjustments, either up or down, will depend on the emerging flow of economic data," RBNZ Governor Graeme Wheeler commented.
Separately, official data showed that New Zealand's trade deficit narrowed to NZ$159 million in December from NZ$285 million in November, whose figure was revised from a previously estimated deficit of NZ$213 million.
Analysts had expected the trade deficit to narrow to NZ$48 million last month.
In the U.S., the Fed said on Wednesday that it would keep rates on hold at least until June and reiterated its pledge to be patient on raising interest rates, while acknowledging the solid economic recovery and strong growth in the labor market.
The central bank also said it expected inflation to keep declining in the short term and added that it would take "financial and international developments" into account before deciding when to hike borrowing costs.
The kiwi was higher against the Australian dollar, with AUD/NZD shedding 0.33% to 1.0745.
Also Thursday, the Australian Bureau of Statistics reported that import prices rose 0.9% in the last quarter, confounding expectations for an increase of 1.5%, after a 0.8% fall in the three months to September.
Later in the day, the U.S. was to publish the weekly report on initial jobless claims as well as private sector data on pending home sales.