WELLINGTON (Dow Jones)--The New Zealand dollar was down late Friday after the release of weaker than expected consumer price index data and due to profit-taking prior to the weekend. BNZ's manager for foreign exchange sales, Mike Symonds, said the New Zealand dollar had given up a fair amount of its overnight gains, which were driven by positive global sentiment. "The kiwi opened here close to US$0.7280 and really across the board we've seen risk currencies lose ground against the U.S. dollar, so it's not just the kiwi," Symonds said. The New Zealand dollar was as high as US$0.7303. Symonds added the second-quarter consumer price index number this morning was on the softer side of market and Reserve Bank of New Zealand forecasts. Statistics New Zealand said the annual inflation rate was 1.8%, while the consumer price index rose 0.3% in the three months ended June 30 compared with three months earlier. The market had been expecting the CPI to rise 2.1% on year and 0.6% on quarter, according to the median estimate of eight economists polled by Dow Jones Newswires. The Reserve Bank of New Zealand had forecast the quarterly CPI would rise 0.5%. Symonds added that markets shouldn't read too much into the weaker kiwi. "I think as the weekend approaches we are just seeing a little bit of profit-taking and trimming back of positions. Risk currencies have had seen a big rise this week as equities remained largely in positive territory, but with stocks losing ground today it's not surprising that the New Zealand dollar has seen a reversal, said Symonds. Overnight the market will be watching the U.S. Consumer Price Index and the University of Michigan Survey of Consumer preliminary index for direction. New Zealand interest rate swaps were trading lower, while government bond prices increased after the CPI data, a local bond trader said. Some economists said after the data release that there was a slight change that the Reserve Bank of New Zealand might hold the official cash rate steady at its next meeting July 29, while other economists forecast a pause in hikes some time during the second half of 2010. -By Lucy Craymer, Dow Jones Newswires; 64-4-471-5990; lucy.craymer@dowjones.com

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