The New Zealand dollar maintained its recovery begun earlier in the day to reach well above US54c late in Wellington.
At 6pm the kiwi whipped up to US54.30c from US53.56c at yesterday's close, although its 5pm figure was only US54.02c. The aussie was at US59.98c.
After trading within a one US cent range overnight of US53.15c-US54.15c, the kiwi stayed above US54c for most of the day, Bank of New Zealand chief currency dealer Mike Symonds said.
"The US dollar's been slipping throughout the afternoon, despite rumours from various news wires that US air strikes may well have killed Saddam Hussein or his sons," Mr Symonds said.
"Initially the US dollar did rally on that and we saw the kiwi and aussie suffer a bit as a result.
"But the issue is that we're seeing quite a large US dollar rally in recent days, and there's a view that most if not all of the good news has been priced into currency markets."
Once the conflict reaches a conclusion, the market will return its focus to fundamentals such as the poor performance of the US and global economy, which will continue to weigh on the greenback.
During the day the kiwi traded between US53.95c and US54.25c.
"I think the kiwi's got a little bit of up side. Bearing in mind we were at US55.50c mid-way through last week, I think this push back higher that started a little earlier today has a bit more to play out," Mr Symonds said.
"It's probably going to trade US54.00/50c overnight."
In Wellington at 5pm the euro was worth $US1.0664 ($US1.0648) and the US dollar was buying 119.85 yen (120.63).
On the crosses at 5pm the kiwi was buying A90.31c (A89.56c at 5pm yesterday), 0.5065 euro (0.5030), 34.79 pence (34.37), 0.7520 Swiss francs (0.7487) and 64.75 yen (64.61).
The Australian dollar was buying $NZ1.1069 ($NZ1.1135).
On the money market, 90-day bills were at 5.79 per cent (5.81), the monetary conditions index was at plus 112 (76) and the trade-weighted index was at 59.80 (59.37).
Among the bonds, the April 2004 yields were unchanged at 5.50 per cent, the November 2006s were at 5.61 per cent (5.63) and the November 2011s were at 6.05 per cent (6.00).
- NZPA
<i>Currency:</i> Kiwi makes ground late in session, builds on early gains
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