The dollar closed at 40.66USc, slightly off its opening price despite a lack of activity yesterday afternoon.
The kiwi opened at 40.57USc after the trade-weighted index hit an all-time low overnight, and the kiwi came within a whisker of new lows against the US dollar.
The TWI - which measures the kiwi against the five currencies of New Zealand's major trading partners - slumped overnight to its worst ever level of 46.77, one hundredth of a point below the previous low hit on September 21. By 5pm it had recovered to 47.06.
ANZ Investment Bank senior foreign exchange dealer Richard Marshall said a US fund had bought a large bundle of kiwi - lifting the currency to 40.80USc.
"Despite the aussie weakness the kiwi remained fairly good. There was also some buying against the aussie from some other US funds," Mr Marshall said.
"It was a busy morning [yesterday] and a quiet afternoon really. There's no real interest at all out there."
The kiwi's fate largely lies in the hands of the Aussie dollar, which was at 54.33USc at local close from overnight lows of 54.10USc, which was within 1 per cent of record lows around 53.60USc hit on September 20.
Chartists said the Australian dollar was likely to head higher toward 55USc before it tested the downside again.
The Reserve Bank reviews the Official Cash Rate today and is expected to hold rates steady.
- NZPA
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