The dollar continued its downward trek yesterday, closing at 41.79USc, from 42.18USc at 9am Thursday.
Citibank's Dean Sheridan said the kiwi was likely to fall further, possibly reaching 41.50USc today.
The kiwi was still riding piggyback on the aussie, which also hit record lows yesterday to dip below the psychological 55USc level and could face further falls despite a strong economy.
Mr Sheridan said the Reserve Bank of Australia was reported to be supporting the Australian dollar.
"I'd say they probably were there, smoothing the aussie at this stage. They wouldn't be sitting there for large amounts, just doing a smoothing operation," he said.
"As soon as the aussie broke 55USc it triggered some stops for the kiwi to 42USc, and we saw further stops from option books selling down to this current level.
"There's every eventuality the kiwi will test the recent lows of 41.32USc in the next few days," he said.
The European Central Bank meeting overnight was not expected to offer any help to the falling euro, which is the driver behind the flagging aussie and kiwi.
Australian traders said the aussie's latest downturn to 54.90USc flowed from negative sentiment hounding it since the start of the year.
Yesterday's fall extended the sell-off, with the currency breaking through its previous low of 55.30USc Thursday.
- NZPA
<i>Currency</i>: Dollar follows aussie down
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