It was a wild ride for the New Zealand dollar overnight as it was sold off along with stocks and commodities.
The kiwi plunged from around 65.60 US cents to 62 in a few seconds in the early hours of the morning.
But then within minutes it bounced back to around 65 cents. That 65c level was around 2.5 percent down from yesterday
The kiwi was not the only currency to be sold off. The Australian dollar fell from 72.30 US cents to 70.50 before it too recovered.
Analysts say the sell-off came after the VIX (CBOE Volatility Index) spiked to levels not seen since the height of the global financial crisis.
The VIX, sometimes called the 'Fear Index', leapt 45.34 percent to a six-and-a-half-year high.
By mid-morning the kiwi was down around 0.8 percent against the Australian dollar at 90.56.
But its losses were greater against some other major currencies. It was down 3.15 percent against the pound at 41.16, and 5 percent lower against the euro at 55.91.
The trading was just as volatile on the world's share markets.
The Dow Jones Industrial Average plunged 1089 points in the opening six minutes of trading.
Over the next five minutes it staged a rally, rising 550 points. Then it fell 300 points. Then it rose 500 points. A case perhaps of panic-buying as well as panic-selling?
The moves were a reminder that although markets are driven by economic data and numbers, they are also driven by emotions and computer trading. Many hedge funds use computers that will start buying or selling when stock prices get to certain pre-determined trigger points.
Investors were spooked by what had been an 8.4 percent fall yesterday on China's Shanghai Composite Index and subsequent falls of around 5 percent on the European markets.
Wall Street recovered around half its losses this morning. The Dow Jones finished down 588 points, or 3.6 percent lower. The broader S&P500 fell 77.68 points, or 3.9 percent.
Oil continued its fall.
West Texas Crude is now trading at around $38.20 - a fall of 5.5 percent.
Gold though is up. It's trading at US$1156 per ounce - a rise of around $1.20.
The US markets are now in correction territory, meaning they have fallen more than 10 percent.
This typically happens once or twice a year. But it had not occurred in the US since late 2011.
So US markets were overdue for a correction. The question now is, do markets find a bottom at these levels or do they fall even further?
Credit Suisse AG Singapore consultant Sean Keane has offered some perspective.
He writes that: "In the greater scheme of things, the US stock market correction is hardly problematic."
The S&P500 is up around 80 percent from 2011. Many had been expecting a pullback.
"The leadership of the market became increasingly narrow in recent months, with fewer and fewer heavyweight stocks lifting the whole index. In the end the weight of the non-performers was too much, and once the leadership group began to falter then the whole index fell rapidly."
He points out that a correction in the markets is not a bad thing. But it can be a problem when it occurs quickly.
"The problems are always about the size of the move and the time taken for the move to happen. Market corrections of 10 percent and more are often very helpful things and do much to strengthen the market and to build resilience amongst end asset holders. When they occur over a manageable period of weeks, months and years they rarely make headlines, and they very often go unnoticed.
"Market corrections that happen very quickly and in chaotic fashion are far less welcome, and they create ripple effects and uncertainty that central bankers cannot ignore."
He is among those who believe the sell-off could delay a possible hike in interest rates from the US Federal Reserve. Any move, or lack of move, by the Fed will in turn have an impact on both currency markets and share markets.
For those worried about a repeat of 2008, he offers some reassuring words.
"There is nothing that is happening today in the funding markets that looks anything like what we saw in 2008."
Keane says that there are "imperfections" in bank balance sheets and risk profiles, but bank capital and reserves are much greater.
"The current market pressure is a combination of a weaker than expected Chinese economy coinciding with the prospects of the first Federal Reserve rate hike in the professional lifetime of a number of market participants.
"This is happening against the backdrop of an uncertain policy response by the Chinese authorities and a plunge in oil prices which is weighing on many energy sector stocks. It was the strength of the oil price and its run up close to $150 per barrel in 2008 that amplified the global financial crisis.
"Aside from the initial pain suffered by some energy related equity prices in the current episode, it's certain to be the case that sub-$40 oil will be tremendously supportive for most of the global economy."3 News