The New Zealand dollar rose above US79c for the first time in five months, as it closed in on the November high around US79.75c.

From US78.54c at 5pm yesterday, the kiwi peaked near US79.30c early today before falling away to US78.86c at 8am. It then had another run at the US79c figure in afternoon trading, scaling it to be US79.38c at 5pm.

The surge in the NZ dollar came even though the Australian dollar market was relatively subdued today.

ANZ said the NZ dollar had broken out overnight to score on all fronts. It was impossible to contain as it trounced opposing currencies with relative ease.

The NZ dollar was also up to 0.5479 euro at 5pm from 0.5426 at the same time yesterday, and rose to A75.45c from A75.00c yesterday. It was at 66.30 yen from 66.08 yen. The trade weighted index rose to 68.88 from 68.30 yesterday.

Sentiment toward the US dollar remains overwhelmingly bearish, largely due to expectations the US Federal Reserve will significantly lag global central banks in raising interest rates.

President Barack Obama set a goal of cutting the US budget deficit by US$4 trillion ($5.07tr), plunging into the debate over the nation's fiscal woes after accusations he has failed to lead on the issue.

"The fiscal austerity Obama is planning to introduce is being received positively and there is optimism on the US economy," said Kathy Lien, director of currency research at GFT in New York. "But it's not enough to cause a full reversal in the US dollar."