NZ dollar dips after US eases stimulus THE New Zealand dollar extended its decline after the Federal Reserve announced plans to continue to wind back its monetary stimulus ahead of a review of New Zealand interest rates. The kiwi slipped to 82.38 US cents from 82.75 cents in 20 minutes after the 8am announcement. The trade-weighted index slipped to 77.95 from 78.38. The Fed said it would reduce its monthly bond purchase programme next month by a further $US10 billion to $US65 billion as expected, after trimming the programme by the same amount this month. The withdrawal of stimulus has contributed to turmoil in emerging markets as investors pull their funds out. New Zealand's Reserve Bank is reviewing interest rates at 9am, with most economists expecting no change. "This morning, event risk for the NZD is very high, with the US Fed and RBNZ announcing rates in rapid succession," said Kymberly Martin, markets strategist at Bank of New Zealand. An 'on hold' decision from the RBNZ, as we expect, could see a dip in the NZD/USD given the market still prices around a 35 per cent chance of a hike today. The greater knee-jerk response would come from an unexpected hike. This would likely see an initial spike higher in the NZD. Traders will also be eyeing reports on Chinese manufacturing and US fourth quarter growth while New Zealand releases data on building consents and migration for December. The New Zealand dollar fell to 83.98 yen from 85.46 yen on Wednesday as investors favoured safe haven currencies on concern about the impact of the Fed's tapering on emerging markets. The kiwi advanced to 94.21 Australian cents from 94.06 cents, weakened to 60.32 euro cents from 60.65 cents and dropped to 49.73 British pence from 49.95 pence after Bank of England Governor Mark Carney reiterated that the bank is in no rush to raise rates.