New Zealand dollar continues to trade above US$0.61
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Daily Currency Update
The New Zealand dollar is slightly stronger this morning when valued against the Greenback currently trading at 0.6137 at the time of writing. The NZD/USD pair soars to 0.6160 in Friday’s New York session. The Kiwi asset witnesses significant buying interest as the US dollar weakens after the United States (US) Personal Consumption Expenditure Price Index (PCE) report for April showed that price pressures grew in-line with estimates. Last week on the data front New Zealand’s ANZ Business Confidence index dropped from 14.9 to 11.2 in May, signaling a decline in business sentiment. Outlook for own activity also decreased from 14.3 to 11.8. According to ANZ, “This month’s Business Outlook survey makes for grim reading, but it also provides confirmation that inflation pressures are waning.” Consumer Confidence started 2024 8.4pts higher than a month ago in early December and is now nearly 7pts above the 2023 weekly average of 78.0. There are no scheduled releases today due to the bank holiday. Looking ahead this week and on Wednesday Statistics New Zealand will release the latest monthly Terms of Trade Index. On Thursday we will see the release of the monthly ANZ Commodity Prices which tends to have a muted impact because the tightly-correlated Australian commodity prices are usually released a few days earlier. Finally, on Friday we will see the release of the monthly Manufacturing Sales.Key Movers
On the data front on Friday U.S. inflation tracked sideways in April, a worrying sign for the U.S. central bank that suggests the elevated pace of price increases could last longer than expected and casts doubt on how soon it will be able to cut interest rates. The personal consumption expenditures (PCE) price index increased 0.3% last month, the Commerce Department said on Friday, matching the unrevised gain in March. The PCE price index rose 2.7% year on year, after advancing 2.7% in March. Economists polled by Reuters had forecast it would climb 0.3% on the month and 2.7% on a year-on-year basis. Core PCE subtracting food and energy prices, rose 0.2% month to month, less than the forecast repeat of March's 0.3% rise. In the 12 months to April, the core index rose 2.8%, the same as expected and as last month's rise. Looking ahead next week and investors will focus on the Manufacturing and the Services PMI, which will be published by the Institute of Supply Management (ISM) and the Nonfarm Payrolls (NFP) for May.Expected Ranges
- NZD/USD: 0.6000 - 0.6200 ▲
- NZD/EUR: 0.5550 - 0.5750 ▲
- GBP/NZD: 2.0650 - 2.0850 ▼
- NZD/AUD: 1.0700 - 1.0900 ▼
- NZD/CAD: 0.8250 - 0.8450 ▲