The New Zealand dollar cruised above the psychological US50c mark yesterday, after catching the coat-tails of a rallying euro overnight.
By 5pm the kiwi was at US50.16c from US49.90c at Thursday's local close, at one stage hitting a high of US50.30c.
Its Australian trading mate improved a touch to US56.12c (US55.99c).
All eyes tonight are on Europe, where the European Central Bank is expected to make an interest rate cut of 50 basis points to bolster the slowing economic expansion.
Overnight, that sent the euro to parity with the US dollar and a fresh 3-1/2 year high against the Japanese yen of 125.03.
By 5pm locally it had eased slightly to 0.9996 , just up from 0.9995c at Thursday's local close.
A local dealer said that even though the Australasian currencies were marching to the beat of their own drums, other factors like a strong euro were supporting them.
"If you look at our TWI, we're outperforming comparatively against the other currencies. We are actually holding our own and leading the charge in a way but we're having these other drivers keeping the momentum going."
The kiwi was tipped to trade in a US50c to US50.35c range overnight.
Dealers were also keeping an eye on the outcome of tomorrow's Auckland City Council meeting over the fate of its quarter stake in Auckland Airport.
"The foreign exchange implications, if any, are unclear at this stage, but could potentially involve some New Zealand dollar demand," said BNZ currency strategist Stu Ritson.
The yen continued to weaken against other currencies, following reports that Japan's finance minister believed the currency was overvalued.
The aussie rose to a five-month high of 70.35 yen , and the kiwi stood at 62.87 yen (62.34 Thursday). The greenback closed here at 125.32 yen, compared with 124.92 on Thursday.
The kiwi strengthened against all its key trading partners at 5pm, buying A89.39c (A89.07c), 0.5019 euro (0.4994), 32.01 pence (31.76), and 0.7398 Swiss francs (0.7351).
The Australian dollar was at $NZ1.1185 ($NZ1.1228).
The trade weighted index was at 57.41 (57.07), the monetary conditions index was at minus 80 (minus 109), and the 90-day bank bill yield was at 5.94 per cent (5.94).
On the bond market, the April 2004s were at 5.73 percent (5.73), the November 2006s were at 5.95 per cent (5.96), the November 2011s were at 6.28 per cent (6.32), and the April 2013s were at 6.33 per cent (6.37).
- NZPA
<i>Currency:</i> Kiwi holds steady, supported by energetic euro
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