Wellington, Aug 3 NZPA - The New Zealand dollar rose to a 10-month high today but dealers said it was due to a fall in the US dollar.

The NZ dollar was buying US66.30c by 5pm, up from US66.08c at 8am and US65.68c at 5pm on Friday.

There was debate about its high today. Reuters reported the currency reached US66.65c today, but dealers said it was US66.50c.

The US dollar fell to its lowest level this year against a basket of currencies in Asian trading after oil price rose and after US growth data.

The Australian dollar also climbed to a 10-month high.

"I think the US dollar index broke a key level and that caused a little bit of a flurry in early afternoon,' said ANZ Institutional Bank chief foreign exchange Murray Hindley said.

He said the NZ dollar came back quickly and prior to its rise the NZ dollar market had been quiet. There is more Australian data than New Zealand data due this week.

US gross domestic product fell at an annual pace of 1 percent in the second quarter, which was better than expected, but a reminder of the economy's poor performance.

The US dollar's slide was driven by technical factors such as stop loss buying and traders following breaks in chart levels.

"The US dollar remains unloved," said Rankin Treasury.

The rising NZ dollar will annoy the Reserve Bank of New Zealand, which has signalled that a high NZ dollar could choke off the recovery.

BNZ said the NZ dollar has recovered all the ground it lost following the central bank's statement last week and no amount of jawboning by it or politicians would have a long lasting impact on the currency.

But the NZ dollar was down to A79.08c against its Australian counterpart at 5pm today from A79.23c at 5pm on Friday.

It was 0.4650 euro from 0.4647, and 62.75 yen from 62.59 yen. The trade weighted index was 61.59 at 5pm from 61.42 on Friday.