New Zealand dollar continues to edge higher towards 70 US cents

Daily Currency Update

The New Zealand dollar is stronger this morning when valued against the Greenback, trading just below 70 US cents on higher risk appetite and commodity prices.  The Kiwi dollar made a small gain to 0.6965, failing on three occasions during the past 24 hours to breach the 0.6975 mark. From a technical perspective, the NZD/USD pair is currently trading at 0.6971. We continue to expect support to hold on moves approaching 0.6935, while now any upward push will likely meet resistance around 0.6975.

On the data front yesterday there were no scheduled releases.  The economic calendar in New Zealand is empty for the remainder of this week.  The Federal Open Market Committee (FOMC) has grabbed all the headlines this week with the market now predicting back-to-back 50bps hikes at the Federal Open Market Committee’s next two meetings. The market currently prices in about 42bps of hikes at each of the next two meetings, so a high chance of moving 50bps. This comes as the International Monetary Fund (IMF) says New Zealand’s high levels of household debt, borrowers’ vulnerability to rising interest rates and banks’ high exposure to housing loans could be a risk for the economy.