A currency specialist believes the New Zealand dollar could break US80 cents on Friday night on the outcome of American jobs figures.
The currency surged to a two-and-a-half year high of 79.7 US cents overnight on Thursday, rising the most strongly against the Greenback of any currency in the previous 24 hours.
The Kiwi has only broken clear of US80 cents twice since the currency was floated in March 1985.
Currency strategist Derek Rankin says poor jobs figures from the US could lead to further weakness in its currency.
Mr Rankin says that could push the New Zealand dollar over US80 cents and closer to its post-float high of US82.2 cents.
Investors dumped US dollars after the Federal Reserve said it would print $US600 billion to put into the American economy by buying more government bonds.
Investors sold US government bonds and bought other assets including shares, oil, and currencies like the New Zealand dollar.
Brazil, China and Germany on Thursday criticised the US decision to devalue its currency.
The move has again raised fears some countries will devalue in retaliation which could leave other countries - including New Zealand - with artificially inflated exchange rates.
The New Zealand dollar got an extra boost after better-than-expected unemployment figures on Thursday.
Surge renews intervention debate
The surging New Zealand dollar has again prompted calls for measures to manage a drop in the currency to help alleviate pressure on hard-hit exporters.
The Reserve Bank is permitted to intervene under certain, strict, conditions, but is loathe to do so despite analysts predicting the New Zealand currency will go beyond US80 cents.
ANZ New Zealand senior markets economist Khoon Goh says the high dollar is hurting exporters but that is partly offset by higher commodity prices due to the US central bank's decision.
Mr Goh says the dollar's level does not warrant any direct intervention by the Reserve Bank, and in any case it would be futile to try, as evidence by the Bank of Japan's failed attempt to weaken the yen.
However, economist Ganesh Nana from independent forecaster Berl, says many other countries are managing their currencies - to New Zealand's detriment.
Mr Nana says New Zealand needs a currency that accurately reflects the productivity, competitiveness and value of New Zealand, rather than, as now, reflecting the weakness of the US dollar and international financial turmoil.
Cheaper shopping, but not until next year
Retailers say the high New Zealand dollar could mean cheaper prices in shops, but shoppers will not benefit until next year.
Retailers Association chief executive John Albertson says the strong dollar won't mean cheaper goods in store before Christmas, as he says businesses have bought most of their Christmas stock, and it is already in the country.
Mr Albertson says the high dollar, coupled with tax cuts and other factors, will be a big help to the retail sector, which has yet to bounce back from the recession.