While providing a boon for travellers, importers and consumers, the weakening of both the Australian and United States dollars puts further pressure on exporters' margins as the kiwi gains strength.
Global economic data, China forecasts, weak overseas stock exchanges and central bank decisions are all conspiring to strengthen the kiwi, which in turn is looking more and more attractive to offshore investors.
Craigs Investment Partners broker Peter McIntyre said an almost 2% decline in the Dow Jones index in New York on Friday was followed by the New Zealand dollar hitting A95.31c during the weekend.
Aside from the Dow's dip, manufacturing data from China came in below expectations, which saw a selling off of the Australian dollar.
''Australia's economy is highly correlated to China with its commodities from the mining sector,'' he said.
About the same time, Mr McIntyre said the World Bank had upgraded China's outlook and growth in its gross domestic product was still expected in the 7% to 8% range.
The Reserve Bank of New Zealand reviews the interest-driving official cash rate on Thursday, with financial markets split on whether it will rise from the record low 2.5%.
In mid-December the kiwi hit a five-year high against the Australian dollar, after Reserve Bank of Australia governor Glenn Stevens talked down the value of his currency, on the same day New Zealand's central bank said local rates were heading higher.
At the time, the kiwi touched A92.46c, up from A91.63c the day before.
The New Zealand dollar touched a two-week low of US82.08c over the weekend as investors moved away from riskier assets. It was trading at US82.32c yesterday morning, from US82.11c at the New York close and US82.81 at at 5pm on Friday, BusinessDesk reported.
Investors are favouring so-called safe-haven assets such as the Japanese yen, Swiss franc, US dollar, US Treasuries and gold and selling riskier assets, such as the high-yielding New Zealand dollar and stocks, on concern about emerging markets.
The local currency continued its ascent against the Australian dollar after Australian central bank board member Heather Ridout was quoted in the Wall Street Journal on Friday saying the Australian had not fallen far enough.
''The kiwi/Aussie still looks very buoyant to the upside,'' said Stuart Ive, senior adviser at OMF, who expects the cross rate may consolidate around 94.50 cents.
"I've said the kiwi is being impacted by an investor ''flight to quality''.
''People are getting out of their riskier investments which may be stock market shares or a higher yielding currency and they are willing to sacrifice the gains that they could possibly get in there for safety as we enter a relatively uncertain moment in time,'' he said.
''There are still some adjustments taking place in global economies.''
The United States central Federal Reserve has its first meeting of the year this week and may continue to taper its $US75-billion-a-month bond-buying programme. Australian banks were closed yesterday for Australia Day.
The New Zealand dollar touched a seven-week low of 83.91 over the weekend and was trading at 84.25 yesterday, from 85.67 on Friday.
The kiwi touched a three-week low of 59.89 eurocents at the weekend and was trading at 60.19c at 8am from 60.50c on Friday.
The kiwi advanced to 49.94 British pence from 49.77 pence on Friday. The trade-weighted index slipped to 78.11 from 78.42 on Friday.
