The New Zealand dollar rose as lower US wages caused investors to question how quickly the Federal Reserve will hike interest rates when it starts tightening monetary policy this year.

The kiwi increased to 78.54 US cents at 5pm in Wellington from 78.38 cents at 8am and 78.35 cents on Friday in New York. The trade-weighted index declined to 79.77 from 79.98 last week.

US data on Friday showed the world's biggest economy added more jobs than expected in December and the unemployment rate fell to its lowest level since June 2008, though wages shrank for the first time in more two years. The decline in hourly earnings caused investors to speculate the Fed may delay raising federal funds rate from its current zero to 0.25 percent band.

"We saw markets refocusing on the fact that wage growth was negative in December and the general thinking is that the deflation pulse from global oil and commodity price declines gives the Fed more time to sit on their hands," said Sam Tuck, senior FX strategist at ANZ Bank New Zealand in Auckland. "That process dragged the kiwi up a bit."

ANZ's Tuck said he still expects the US dollar to remain in the ascendant this year as the Fed starts moving away from its extraordinary stimulus measures.

A BusinessDesk survey of nine currency strategists and traders predicts the kiwi may trade between 76.50 US cents and 80 cents this week, with six picking it to rise, two seeing it broadly unchanged and one predicting a fall.

The prospect of slower interest rate hikes by the Fed had put pressure on global bond yields, and New Zealand's longer-dated rates declined. That differs from the 'short' end of the interest rate curve, which is typically linked more closely with the local benchmark rate, in New Zealand's case the official cash rate.

The 10-year swap rate fell to 3.97 at 5pm in Wellington from 4.02 on Friday, while the two-year swap rate dropped to 3.765 from 3.82.

ANZ's Tuck said the decline in the rates didn't translate to a drop in the kiwi, as New Zealand's existing yield advantage remains strong enough to attract investors.

The local currency was little changed at 92.89 yen at 5pm in Wellington from 92.95 yen on Friday in New York, and fell to 95.22 Australian cents from 95.56 cents. It traded at 66.24 euro cents from 66.20 cents last week, and increased to 51.79 British pence from 51.69 pence. It advanced to 4.8693 Chinese yuan from 4.8675 yuan last week.