The New Zealand dollar remained buoyant above the US44.50c level yesterday.
At 5pm the kiwi was trading at US44.54c, compared with Wednesday's close of US44.15c, while the aussie was US53.78c (US53.36c).
The kiwi traded in a range of US44.50/64c during the day.
"It just seems to have been tracking the aussie today - when the aussie gets up to above US53.80c we climb up to the dizzying heights of US44.60c," one dealer said.
"It does seem pretty well supported, I think people will be looking to buy on any dips down to US44.40/45c and definitely the risk is to the top-side.
"I think in all, generally people like them (the aussie and kiwi), they're back in favour."
The Reserve Bank's 25-point interest rate rise yesterday was bang on expectations. There has been some criticism of governor Don Brash for moving when other central banks have stayed put, but the dealer said it signalled to international markets that Dr Brash was pretty happy with the economy.
"I suppose that's why when they came into work last night they decided they might like to buy some (kiwi)."
Kiwi and aussie strength was exacerbated by across-the-board weakness in the US dollar, which looked like it may ease further.
Overnight the US dollar took a battering as the recovering global economy and weak US stocks gave investors reason to diversify outside the United States.
Basil Payn of Westpac said the kiwi was rising faster than long-term charts had predicted because of a "double whammy" of greenback weakness and domestic economic strength.
"With the rate hike on Wednesday, the interest rate differentials are starting to go a little bit more in the kiwi's favour so the kiwi is reasonably well bid. (We can) probably expect to see a little bit more topside in the next couple of days."
On the crosses the kiwi was up against all its major trading partners, trading at A82.83c (A82.65c at Wednesday's close), 0.5001 euro (0.4999), 58.20 yen (57.81), 30.80 pence (30.65) and 0.7352 Swiss francs (0.7340).
The aussie was buying $NZ1.2071 ($NZ1.2099).
The monetary conditions index tightened to minus 465 (minus 490), the trade weighted index was at 53.35 (52.90), and 90-day bank bills were at 5.74 per cent (5.75).
On the debt market, short-dated bond yields fell. The April 2004 bond yield was at 6.21 per cent from 6.25 percent, the November 2006s were at 6.67 per cent (6.70), and the November 2011s were unchanged at 6.88 per cent.
- NZPA
<i>Currency:</i> Kiwi buoyant around US44.50c
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