New Zealand dollar continues to trade below 56 US cents

Daily Currency Update

The New Zealand dollar is weaker this morning when valued against the greenback. USD strength was the order of the day on Friday amidst a backdrop of renewed risk aversion and higher US rates with risk-sensitive commodity currencies were the main underperformers on Friday. The Kiwi dollar fell 1.4% during Friday’s session. Over the course of the week, the NZD was down almost 1%, ending near multi-year lows at around US$0.5560. The NZD/AUD cross is approaching US$0.90 for the first time since August.

Looking ahead this week on the data front and today we will see the release of the Business NZ Services Index. A survey of purchasing managers asks respondents to rate the relative level of business conditions including employment, production, new orders, prices, supplier deliveries, and inventories. On Tuesday Statistics New Zealand will release Consumer Price Index (CPI) figures for the quarter. The market looking for a 1.5% quarterly increase in CPI in Q3, which would lower the annual rate to 6.5% y/y from 7.3% previously. This would be marginally above the RBNZ’s 1.4% q/q MPS forecast. On Friday we will see the release of the both NZ Trade Balance and monthly Credit Card Spending figures.