The New Zealand dollar – tipped to be one of the hottest currency trades this year – soared to its highest level since August 2011 on Friday, but is there a danger the party could be over soon?
The kiwi hit a two-and-a-half-year high of $0.8693 on Friday, spurred by better-than-expected trade data and comments from the Reserve Bank of New Zealand's (RBNZ) deputy governor Thursday that suggested the bank was not worried about its recent strength.
The currency has been a hot trade in recent times amid expectations that New Zealand would be the first developed economy to hike interest rates, triggering a 13 percent surge in the dollar since June last year.
The RBNZ delivered on its promise earlier this month by hiking rates to 2.75 percent from a record low of 2.5 percent, and the tightening bias could continue with the central bank pledging previously to raise rates by 225 basis points over the next two years.
(Read more: New Zealand central bank hikes interest rates)
However, some analysts told CNBC that despite the stellar gains over the past year, good times for the kiwi may have a sell-by date.