The New Zealand dollar rallied along with most other currencies as plunging stock markets in the United States spurred loss-covering sales of US dollar positions.
The kiwi was trading at 66.98 US cents at 8.30am in Wellington from 66.24 cents at 5pm yesterday. The trade-weighted index rose to 73.18 from 72.61 yesterday.
"Yesterday's action in the currency was pretty violent and we've seen a retracement overnight and a big sell-off of US dollars," says Tim Kelleher, head of external foreign exchange sales at ASB Bank.
The currency has traded in a huge range against the greenback, between 65.88 US cents overnight Wednesday and 67.50 cents yesterday.
That reflected a combination of worrying news from Apple Inc. blaming a December slowdown in sales on a slowing Chinese economy to Chinese sabre-rattling over Taiwan, ongoing Brexit concerns and the failure of US legislators to end a partial government shutdown now about to end its second week.