The New Zealand dollar was left largely unmoved by the Reserve Bank's decision to leave interest rates where they were today.
Nevertheless, the kiwi currency had a bid tone to it which saw it hold its own against a softer aussie.
At 5pm the kiwi was trading at US47.38c compared to yesterday's close of US46.89c.
"It rallied overnight to the US47.35c level we've had a pretty quiet afternoon rangewise but reasonably active," one local dealer said. "Australian dollar's been under a little bit of pressure but we've remained reasonably well bid."
While the kiwi was "looking ok," it was still at the top end of the broad US46.60/47.60c range it has been trading in for several weeks.
By comparison, the aussie dollar was barely higher than its close yesterday, trading at 5pm at US54.26c (US54.17c).
Both currencies rallied overnight on the back of a rebound on global stock markets, after a return to multi-year lows yesterday.
Neither currency appeared to be much affected by widely anticipated decisions from their central banks to keep interest rates static.
New Zealand's new RB Governor Alan Bollard announced he was leaving the official cash rate at 5.75, citing stronger than expected growth in the New Zealand economy in the first half of the year, which was being kept in check by a slower than expected world recovery.
On the crosses at 5pm, the kiwi was at a two-and a half-month closing high against the aussie of A87.21c (A86.57c at yesterday's close). It also rose against all other major currencies to trade at 58.24 yen (57.27), 30.26 pence (29.84), 0.7056 Swiss francs (0.6911), and 0.4823 euro (0.4747).
The aussie was buying $1.1456 ($1.1558).
On the money market, bonds jumped but appeared to be taking their lead from offshore markets rather than the local interest rate decision.
Nevertheless, one bond dealer said Dr Bollard's statements were being interpreted slightly dovish and therefore positive for bonds.
The 90-day bills were steady at 5.89 per cent, the trade-weighted index was easier at 54.52 (53.83), and the monetary conditions index tightened to minus 343 (minus 407).
The April 2004 bonds yields jumped to 5.67 per cent (5.61), the November 2006 bonds were at 5.96 per cent (5.88), and the November 2011 bonds were at 6.14 per cent (6.05).
- NZPA
<i>Currency:</i> Interest rate decision leaves Kiwi largely unmoved
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