June 6 (Reuters) - Melexis will provide Chinese car manufacturer NIO with current sensor chips for its traction inverter system, it said on Thursday, becoming the latest European supplier to partner with a Chinese automaker.

Melexis' shares were 2.7% higher at 85.1 euros by 1408 GMT following the announcement.

The Belgian semiconductor supplier said its chips, needed to convert a battery's direct current into the alternating current used by an electric motor, will power all of NIO's battery electric vehicles.

"Our current sensor (integrated circuit) ICs, coupled with the expertise of our dedicated local engineers, will provide NIO with the support they need to achieve success in the electric vehicle market," said Dieter Verstreken, Vice-President of Melexis's China Strategy, in a statement.

Semiconductor suppliers like Melexis, hurt by slower global car sales, are turning to Chinese car makers, many of which are looking to expand in Europe.

STMicroelectronics on Tuesday said it had signed a long-term Silicon Carbide supply agreement with China's Geely .

(Reporting by Nathan Vifflin; Editing by Kirsten Donovan)