New Zealand dollar consolidates above US$0.63
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Daily Currency Update
The New Zealand dollar is slightly stronger this morning when valued against the Greenback, currently trading at US$0.6339 at the time of writing. NZD/USD extends its winning streak for the third successive day, trading around US$0.6360 during the early European hours on Monday. The NZD could test the resistance at US$0.6370, before the risk of a pullback.On the data front yesterday, New Zealand’s ANZ business confidence surged to 60.9 in September, up sharply from 50.6 in August and crushing the forecast of 43.0. This was the highest level since April 2014 as most categories showed an increase in activity. The positive data was a vote of confidence in the Reserve Bank of New Zealand’s decision to lower rates in August, the first reduction since 2020. The rate cut was a surprise as the RBNZ had previously sounded hawkish about its rate policy due to stubborn inflation.
Looking ahead today, Statistics New Zealand will release the latest monthly Building Consents and on Friday we will see the latest monthly ANZ Commodity Price Index.
Key Movers
US Inflation is moving in the right direction and Friday’s Core PCE Price Index, the Fed’s preferred inflation indicator, was within expectations. The index rose just 0.1% MoM in August, a three-month low. This was down from 0.2% in July and below the market estimate of 0.2%. Yearly, Core PCE ticked up to 2.7%, after three consecutive months at 2.6%, which is in line with expectations. The Dow Jones Industrial Average was hamstrung at the start of a fresh trading week.The major equity index eased slightly on Monday but stayed close to the 42,000 level. Stock traders are eyeing data risks and rate markets are grappling with the odds of a follow-up cut from the Federal Reserve (Fed) in November. Prices of Gold came under further pressure and added to Friday’s losses near the $2,630 region per ounce troy. In the same direction, Silver prices dropped to four-day lows and revisited the sub-$31.00 region per ounce.
Market focus will be slowly swinging around toward Friday’s US Non-Farm Payrolls report as investors look for more data on the state of the US economy.
Expected Ranges
- NZD/USD: 0.6250 - 0.6450 ▲
- NZD/EUR: 0.5600 - 0.5800 ▲
- GBP/NZD: 2.0950 - 2.1150 ▼
- NZD/AUD: 1.0800 - 1.1000 ▲
- NZD/CAD: 0.8500 - 0.8700 ▼