The New Zealand dollar is now at a three-year low against the US dollar.
Photo: 123rf
It is trading at 74.6 US cents although it went as low as 73.94 earlier.
Eriksen and Associates investment analyst Jonathan Eriksen said the euro was weak so the US dollar was strengthening on the back of that in a nervous market.
Mr Eriksen told Morning Report that with many New Zealanders on holiday, fewer people were around to buy the New Zealand dollar and with light trading there were bigger fluctuations.
And he said the forecast was for more volatility.
"You've just got to hang on to your hats this year. The stockmarket's going to go down quite a lot. Hopefully it will recover somewhat," he said.
"Interest rates at some stage are going to go up but we're going to have a very exciting ride with big fluctuations in exchange rates and stockmarkets and interest rates.
Mr Eriksen said he estimated the dollar could go down to 72 US cents, though some people believed it would go as low as 70.
