KEY POINTS:
The New Zealand dollar hit new highs today as it inched closer to US80c.
The kiwi took off again in busy afternoon trading, hitting a fresh post-float high of US79.6 and ending the session on US79.57c.
News that the dairy farmer payout is likely to be nearer $6.60/kg
of milksolids, rather than the record $5.53 announced just six weeks ago, gave the kiwi fresh legs.
A $3 billion boost on last year's payout for farmers is likely to remove any doubt, if there was any, at the Reserve Bank that another rate hike on Thursday was appropriate, economists said.
That interest rate hike, and possibly another next month, will keep the currency underpinned.
Other data also showed the economy was running hot. Credit card billings rose at their strongest pace in six months in June, despite three rises in interest rates by the central bank.
The Reserve Bank said total billings rose a seasonally adjusted 1.9 per cent last month, following a rise of 0.5 per cent in May and a fall of 0.8 in April.
Billings were up a seasonally-adjusted 9.1 per cent against a 5.7 per cent gain in the May year. It was the quickest rate of monthly and annual growth since December 2006.
Eleven of 17 analysts in latest Reuters poll expect the central bank to raise rates to 8.25 per cent on Thursday.
Citibank economist Annette Beacher said data in recent weeks had tipped the odds in favour of further RB tightening.
"We expect 25bp to 8.25 per cent, as now does consensus," she said.
"We also expect the RBNZ to leave the door open for additional tightening, should it not witness a material slowdown in activity in the coming months."
ANZ bank said the kiwi was also getting support from a strengthening Australian dollar, which broke above US88c.
On the cross, the kiwi rose to A90.26c from A90.17c yesterday.
The trade weighted index ended the week on 76.0, close to its all-time high of 76.08c touched on Tuesday.
Reuters currency rates:
4.45pm today 4.30pm yesterday
NZ dlr/US dlr US79.53c US79.12c
NZ dlr/Aust dlr A90.26c A90.16c
NZ dlr/euro 0.5763 0.5737
NZ dlr/yen 97.18 96.52
NZ dlr/stg 38.80p 38.54p
NZ TWI 76.00 75.65
Australian dollar US88.08c US87.76c
Euro/US dollar 1.3796 1.3795
US dollar/yen 122.22 121.95
- NZPA