New Zealand dollar trades below US$0.62
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Daily Currency Update
The New Zealand dollar is slightly weaker this morning when valued against the Greenback currently trading at 0.6148 at time of writing. The Kiwi dollar declined on Friday despite the US dollar (USD) weakening as traders raise bets for the Federal Reserve (Fed) reducing interest rates by 50 basis points (bps) on Thursday. Meanwhile, the New Zealand dollar (NZD) weakens amid growing speculation that the Reserve Bank of New Zealand (RBNZ) will cut interest rates aggressively. The RBNZ started the policy-easing cycle unexpectedly in August and is expected to reduce its Official Cash Rate (OCR) in each of its remaining policy meetings this year. Looking ahead this week and today BusinessNZ will release the Performance of Services Index a survey of purchasing managers which asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. On Wednesday we will see the release of the Westpac Consumer Sentiment and Current Account which is directly linked to currency demand. A rising surplus indicates that foreigners are buying more of the domestic currency to execute transactions in the country. On Thursday Statistics New Zealand will release the latest quarterly Gross Domestic Product (GDP) figures which are expected to be -0.4% down from the previous quarter 0.2%. Finally, on Friday the Reserve Bank of New Zealand will release the latest Credit Card Spending which is correlated with consumer spending and confidence - rising debt levels are a sign that lenders feel comfortable issuing loans, and that consumers are confident in their financial position and eager to spend money.Key Movers
US stock indices closed higher on Friday on hopes of a bigger interest rate cut by the Federal Reserve next week. The Dow Jones Industrial Average rose 297.01 points, or 0.72 per cent, to 41,393.78, the S&P 500 gained 30.26 points, or 0.54 per cent, to 5,626.02 and the Nasdaq Composite gained 114.30 points, or 0.65 per cent, to 17,683.98. For the week, the S&P 500 rose 4.02 per cent and the Nasdaq climbed 5.95 per cent, and the Dow added 2.60 per cent. Looking ahead this week and the Federal Reserve is preparing to announce interest rate cuts as soon as Wednesday. The board is set to meet on Sept. 17 through 18. The move by the Fed could bring some signs of economic relief to people with mortgages, credit cards, and vehicle loans. The current Federal Reserve interest rate is at 5.25% to 5.50%, which has remained unchanged since the Federal Open Market Committee set the rate — a 23-year-high — in July 2023. Following the Fed monetary policy committee’s decision on interest rates, Chair Jerome Powell will hold the press conference to elaborate on policy outcome. The Fed has kept its main interest rate at a two-decade high in hopes of slowing the economy enough to stifle high inflation. On Thursday we will see the release of the Philadelphia Fed manufacturing survey for September and existing home sales for August.Expected Ranges
- NZD/USD: 0.6050 - 0.6250 ▼
- NZD/EUR: 0.5450 - 0.5650 ▼
- GBP/NZD: 2.1200 - 2.1400 ▲
- NZD/AUD: 1.0750 - 1.0950 ▼
- NZD/CAD: 0.8250 - 0.8450 ▲