Kiwi boosted by strengthening fundamentals.

The New Zealand dollar was one of the strongest performing currencies on Wednesday morning in Asia, with a rebound in Chinese equities and a strong rise at Fonterra's dairy auction providing some support for the currency.

Traders woke to news that dairy prices were up some 10.9% overnight at Fonterra's Global Dairy Trade (GDT) auction, the second consecutive increase at the auction. Prices of whole-milk powder, the most important commodity for New Zealand, gained 12.1% at the auction to sell for $2,078 per metric tonne.

Added to the positive news for New Zealand, Chinese equities swung into positive territory after a few hours of trading deep in the red on Wednesday morning. The Shanghai Composite Index gained 0.31% to trade at 3,176.34 points just before midday in China.

The NZD/USD pair traded 0.56% higher at $0.6360 on Wednesday afternoon in Wellington, rising from $0.6325 where the cross closed in New York on Tuesday, and off an intraday low of $0.6311.

The currency's commodity-linked status also likely provided some support on Wednesday, with oil futures making reasonable advances early on.