The New Zealand dollar firmed to one-month highs against the greenback on stronger-than-expected inflationary data.
The consumer price index, used as a gauge for inflation, saw prices rise by 1.5 per cent for the June quarter, the fastest quarterly price rise in 16 years .
The kiwi dollar jumped about 15 basis points to US62.28c after the release of the data, but drifted back to US62.06c at 5pm.
ANZ forex chief Murray Hindley said the firmer kiwi had run into good selling from the domestic importer base, and a public holiday in Japan.
"With really no Tokyo today, it's been a little bit subdued this afternoon, but I would expect it to be supported on any dips back to US61.80c and I think there's still a chance that we can test the upper end of US62.50c."
Mr Hindley said the CPI data suggested the Reserve Bank was going to remain "hawkish in its tone".
Economists said they were not projecting any interest rate cuts until early to mid next year.
Against the aussie dollar, the kiwi hit a three-week high
at A82.68c from A82.25c on Friday night and to 0.4917 from 0.4865 against the euro .
Over the weekend, tensions in the Middle East and with North Korea sent the US dollar upwards against the yen in a flight to safety.
However, analysts said the US dollar rally could be short-lived, given a drop in consumer sentiment and retail sales, key indicators of consumer spending patterns.
The yen fell against other major currencies after the Bank of Japan's announcement it did not intend to raise interest rates further beyond its 25 basis point lift.
The following are Reuters currency rates:
5pm today 5pm Friday
NZ dlr US62.06c US61.75c
NZ dlr/Aust dlr A82.68c A82.25c
NZ dlr/euro 0.4917 0.4865
NZ dlr/yen 72.24 71.48
NZ dlr/stg 33.81p 33.52p
NZ TWI 62.53 62.06
Australian dollar US75.08c US75.08c
Euro/US dollar US1.2624c US1.2691c
US dollar/yen 116.39 115.74
- NZPA
<i>Currency:</i> Kiwi firms on higher price data
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