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By Charlotte Greenfield
WELLINGTON, Nov 3 (Reuters) - The New Zealand dollar NZD=D4 rallied to an almost one-month high in the early hours of Thursday morning buoyed by strong domestic economic data and helped by weakness in the greenback.
The Kiwi rose 1.4 percent, its largest daily rise in almost two months, reaching a high of $0.7309 in early Pacific trading on Thursday.
"Yesterday's unequivocally strong labor market data and the surge in GDT dairy prices, along with general USD weakness, saw the jump in the Kiwi extended overnight," said Kyle Uerata, economic statistician at ANZ, in a research note.
International milk prices rose 11.4 percent in this week's fortnightly auction, underscoring a nascent recovery in prices in good news for New Zealand's largest export earner. Record employment data showing strong jobs growth added to the positive sentiment. the risk-off mood, the NZD has been the best performer," said BNZ currency strategist Jason Wong in a research note.
The Kiwi began to pull back on Thursday morning, slipping just below the resistance level of $0.7300 that it had broken overnight to around $0.7288.
The currency also rallied against the Australian dollar NZDAUD= , rising 1.3 percent, its strongest daily rise since July, to A$0.9533, before retracing slightly to A$0.9505 in late morning trading.
The Kiwi would likely rise higher against the U.S. dollar in the days ahead, and could reach $0.7370, according to Westpac senior market strategist Imre Speizer.