Home Daily Commentaries New Zealand dollar holds above US$0.61

New Zealand dollar holds above US$0.61

Brett Ottawa
Written by
Brett Ottawa

Brett Ottawa

OFXpert

Brett brings a wealth of experience, boasting more than 15 years in the foreign exchange market.

| Monday 24 June, 2024

Daily Currency Update

The New Zealand dollar is slightly weaker this morning when valued against the Greenback currently trading at 0.6103 at the time of writing. NZD/USD pair recovered almost a quarter of a percent to trade in the 0.6110s after the US dollar softened following the release of monthly US Retail Sales data which shows shoppers tightened their belts in both April and May. The NZD/USD finds immediate support near the 0.6100 level. Beneath that, additional support resides at the 100-day SMA at 0.6070 and the 200-day SMA at 0.6060. Last week on the data front New Zealand’s economy exited recession with modest expansion in the first quarter. Gross domestic product gained 0.2 per cent from the previous quarter, when it declined 0.1 per cent, Statistics New Zealand said on Thursday in Wellington. Economists expected 0.1 per cent growth. GDP rose 0.3 per cent from year-on-year, beating the 0.2 per cent estimate. The economy is struggling as the Reserve Bank of New Zealand keeps its key interest rate at 5.5 per cent, the highest since 2008, to bring inflation back under control. While strong immigration and a tourism recovery are aiding activity, steep borrowing costs are curbing consumer spending and business investment. Looking ahead this week and today Statistics New Zealand will release the latest monthly Trade Balance figures. On Thursday we will see the latest ANZ Business Confidence survey of about 1,500-2,000 businesses which asks respondents to rate the relative 12-month economic outlook.

Key Movers

In the US on Friday we saw the release of monthly US Retail Sales data, which shows shoppers tightened their belts in both April and May. Retail Sales rose 0.1% month-over-month in May but fell below the 0.2% forecast by economists. April’s flat reading, meanwhile, was revised down to a negative 0.2%, according to data from the US Census Bureau, released on Tuesday. Retail Sales ex Autos, declined 0.2% MoM falling below the 0.2% consensus estimate and the downwardly revised 0.1% decline in April. The April figure itself was revised down from a positive 0.2% preliminary reading. S&P Global Manufacturing and Services Flash PMIs in June expanded above estimates. The Manufacturing PMI rose to 51.7, up from 51.3 and exceeding the estimate of 51. The Services PMI increased from 54.8 to 55.1, surpassing the forecast of 53.7. US Existing Home Sales in May were lower than expected, falling to 4.11 million from 4.14 million in April, representing a contraction of -0.7%. Given the backdrop, Gold prices continued to drop, along with technical indicators, pointing to a correction following a three-month rally that began in March and lifted XAU/USD to its all-time high of $2,450.

Expected Ranges

  • NZD/USD: 0.6000 - 0.6200 ▼
  • NZD/EUR: 0.5600 - 0.5800 ▲
  • GBP/NZD: 2.0500 - 2.0700 ▲
  • NZD/AUD: 1.0700 - 1.0900 ▼
  • NZD/CAD: 0.8250 - 0.8450 ▲

Written by

Brett Ottawa

OFXpert

Brett brings a wealth of experience, boasting more than 15 years in the foreign exchange market. He started his foreign exchange career with OFX more than a decade ago, as a private dealer catering to individual clients. He later transitioned to the corporate sector, assuming the position of Corporate Senior Relationship Manager. What truly excites Brett is the opportunity to engage with people, supporting their business growth and sharing in their successes.