LONDON, Jan 20 (Reuters) - The New Zealand dollar extended broad falls on Wednesday, losing around two and a half percent on the day versus the U.S. dollar and yen, after local inflation data cooled expectations of an interest rate hike soon.
The currency has come under heavy selling pressure in line with other commodity-linked currencies such as the Australian dollar on concerns China is stepping up efforts to curb bank lending and as oil prices dipped below $78 per barrel.
The New Zealand dollar fell 2.5 percent to a three-week low of $0.7205, leaving it on track for its biggest daily percentage fall since late October.
It lost around the same amount against the yen to hit a three-week low of 65.49 yen, while the Australian dollar lost 1.3 percent on the day to hit a session low of $0.9123.
The Canadian dollar hit a session low against the U.S. dollar of C$1.0394, with traders citing demand from U.S. banks.
Soft fourth-quarter inflation data in New Zealand has led some economists to scale back their forecasts for when the Reserve Bank of NZ will start raising rates. [ID:nSGE60J00Q] [ID:nSGE60I0K8]
