A weakening US dollar helped the New Zealand dollar build up a head of steam during yesterday's session.
At 5pm the kiwi dollar stood at US49.79c, more than half a cent higher than its opening levels and well up on Tuesday's close of US49.11c.
The aussie dollar had also picked up speed to US57.56c, up 36 points from its opening and from US57.20c Tuesday.
Dealers said news of accounting improprieties at telecommunications giant WorldCom had eroded the US dollar, creating expectations that it would slide further during trading tonight.
Overnight the kiwi dollar was expected to take another tilt at US50c, ahead of today's balance of payments data and Friday's Gross Domestic Product figures. Dealers picked it to trade between US49.60c to US50c.
The market also has its eyes on the latest US Federal Reserve announcement this morning, although no changes in interest rates are expected.
The local unit improved on all the major crosses, buying A86.51c (A85.87c at Tuesday's close), 60.17 yen (59.82), 32.88 pence (32.72), 0.7410 Swiss francs (0.7417) and 0.5050 euro (0.5059).
Against the kiwi, the aussie was buying $NZ1.1560 ($NZ1.1646).
On the money market 90-day bills were at 5.95 per cent (5.99), the trade-weighted index was at 56.60 (56.20) and the monetary conditions index was at minus 150 (minus 180).
Meanwhile, the debt market posted huge moves, with bond yields falling up to 17 basis points in the biggest one-day rally since September 12.
Dealers said the New Zealand market reflected similarly large moves in the US Treasuries and Australian futures markets, which are seen as benefiting from safe-haven buying.
The April 2004 bonds were at 5.90 per cent (6.02), the November 2006 bonds were at 6.28 per cent (6.43), and the November 2011 bonds were at 6.44 per cent (6.60).
- NZPA
<i>Currency:</i> Weaker US helps Kiwi close on firm note
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