New Zealand dollar continues to trade below US$0.60
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Daily Currency Update
The New Zealand dollar is slightly weaker this morning when valued against the Greenback currently trading at 0.5881 at the time of writing. The Kiwi dollar remains under selling pressure this morning below 0.5900 as riskier assets faced pressure due to heightened geopolitical risk across financial markets. Apart from this, the higher possibility that the US Federal Reserve (Fed) might delay interest rate cuts further provides some support to the Greenback. Last week on the local front in New Zealand Statistics NZ's latest consumer price index (CPI) data showed headline inflation was at four per cent for the year to March 2024, and at 0.6 per cent for Q1 2024. A fall to four per cent has New Zealand's inflation levels are the lowest for almost three years, but still outside the Reserve Bank's target band. The overall CPI figure lands in the mid-point of market expectations, with ANZ tipping annual inflation at four per cent, Kiwibank predicting 4.2 per cent, and the Reserve Bank (RBNZ) forecasting an optimistic 3.8 per cent. Looking ahead this week and today the RBNZ will release the latest monthly Credit Card Spending figures. It's 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. On Wednesday we will see the release of the latest Trade Balance figures for the previous month.Key Movers
The US dollar Index (DXY) is currently trading at 106.09, a mild loss from its recent peak of 106.35. Despite this, the index remains geared toward testing its November 1 high of 107.10. The number of Americans filing new claims for unemployment benefits was unchanged at a low level last week, pointing to continued labor market strength that is driving the economy. Initial claims for state unemployment benefits were unchanged at a seasonally adjusted 212,000 for the week ended April 13, the Labor Department said on Thursday. Labor market resilience, together with elevated inflation have led financial markets and some economists to expect that the Federal Reserve could delay cutting interest rates until September. A few economists doubt that the U.S. central bank will lower borrowing costs this year.The Pound Sterling tumbled against the US dollar during the mid-North American session on Friday after a volatile trading day due to geopolitical risks. The GBP/USD currently trades at 1.2367, down 0.49%. British Retail Sales showed signs of stagnation during the European session in March compared to February’s reading. Analysts were expecting sales to grow 0.3% MoM, which came at 0%, while core sales tumbled from 0.3% to -0.3%. On an annual basis, the Office for National Statistics (ONS) revealed that sales rose by 0.8%, which is up from a drop of -0.3% in February.
Expected Ranges
- NZD/USD: 0.5800 - 0.6000 ▼
- NZD/EUR: 0.5400 - 0.5600 ▼
- GBP/NZD: 2.0900 - 2.1100 ▲
- NZD/AUD: 1.0800 - 1.1000 ▼
- NZD/CAD: 0.8000 - 0.8200 ▲