The kiwi stormed US50c yesterday and looked ready to head higher as the United States dollar weakened.
Overnight the kiwi got a fillip from a half a percentage point cut in United States benchmark interest rates to 1.25 per cent, compared with New Zealand's 5.75 per cent Official Cash Rate.
At 5pm the kiwi traded at US49.95c, well up on its close on Thursday of US49.72c, while its aussie counterpart was trading at US56.64c from Thursday's US56.44c.
One local dealer said the kiwi traded in a 21-point range, topped by the US50.10c level, and was likely to test key resistance of US50.40c in the near future.
"I think the overall outlook's pretty positive.
"Most of this move over the last 24 hours has been more related to a general US dollar weakness than a kiwi strength," he said.
The trade weighted index -- based on a basket of currencies from New Zealand's key trading partners -- has hardly moved in recent days, underscoring the impact of the weak US dollar as opposed to a strong kiwi.
"We're marking time against the basket but firming against the US, along with everything else. I believe there's a move towards US52c on the cards here."
He picked the kiwi to consolidate in northern hemisphere trade overnight, with a likely range of US49.90c and US50.30c.
The kiwi was likely to appreciate slightly on the aussie cross as it rises.
In Tokyo, the greenback slipped to near two month lows against yen, fuelling talk that Japanese monetary authorities may intervene.
Dealers said the US dollar's underlying tone remained bearish after the US Federal Reserve's surprising half-point rate cut on Wednesday, tensions surrounding Iraq and Wall Street's biggest drop in three weeks.
Such negative factors surrounding the dollar boosted the euro, which shot up as high as US$1.0099 overnight, a 3-1/2 month high. The euro eased slightly to close in Wellington at US$1.0087.
On the crosses, by 5pm the kiwi was buying A88.15c (A88.25c), 0.4950 euro (0.4957), 60.44 yen (60.64), 0.3162 pence (0.3185), and 0.7249 Swiss francs (0.7239).
The Australian dollar was buying $1.1345 ($1.1349).
The 90-day bank bill yield was at 5.90 per cent (5.91), the New Zealand dollar trade-weighted index was at 56.51 (56.45), and the monetary conditions index was at minus 162 (minus 166).
The April 2004 bonds were at 5.65 per cent (5.66), the November 2006s were at 5.93 per cent (5.99), and the November 2011s were at 6.19 per cent (6.29).
- NZPA
<i>Currency:</i> Kiwi storms US50c, eying up US52c
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