The New Zealand dollar was charting new territory yesterday and appeared ready to take on the US50c mark.
At 5pm the kiwi traded at US49.62c, down on the US49.71c level touched overnight but up on Monday's close of US49.06c.
The aussie was at US56.12c, edging down from an overnight high of US56.21c but up on its close on Monday of US55.98c.
ANZ Investment Bank chief foreign exchange dealer Murray Hindley said the kiwi had broken into a new range of US49.20/50.20c.
During the day the kiwi traded between US49.59/82c.
"It's been pretty busy, whether we can continue to push higher is another matter. All eyes will be focused on what the US Fed will do this week, but certainly we've seen a flight to some of the high yielders.
"I think it's only a matter of time before we have another test of the US50c level.
"It certainly has broken that (aussie cross) as well.
The kiwi was trading at A88.43c yesterday, from Monday's close of A87.65c - a level last seen in January, 1998.
"I think A88.50c probably has some consolidation at these levels as we see a little bit of local importer covering, but we could see a chance of A90c in the next month or so," Mr Hindley said.
In offshore trade, the greenback was on the defensive ahead of US midterm elections and a Federal Reserve meeting on monetary policy.
The dollar came under pressure as operators also used growing military tension between Iraq and the United States as an excuse to sell.
The Fed is widely expected to reduce its key interest rate by at least one quarter of a percentage point on Thursday morning, NZ time, from a four-decade low of 1.75 per cent.
On the crosses at 5pm the kiwi was at 0.4968 euro (0.4925 at Monday's close), 60.39 yen (59.99), 0.3186 pence (0.3137), and 0.7271 Swiss francs (0.7205).
The Australian dollar was buying $NZ1.1309 ($NZ1.1410).
The 90-day bank bill yield was unchanged at 5.91 per cent, the New Zealand dollar trade-weighted index was at 56.48 (55.94), and the monetary conditions index tightened to minus 163 (minus 240).
The April 2004 bonds were at 5.69 per cent (5.67), the November 2006s were at 6.00 per cent (5.97), and the November 2011s were at 6.26 per cent (6.23).
- NZPA
<i>Currency:</i> Kiwi breaks into new territory, ready to tackle US50c
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