New Zealand dollar trades above US$0.62

Daily Currency Update

The Kiwi dollar is slightly stronger this morning when valued against the Greenback. The NZD/USD traded stable at the 0.6210-0.6245 range at the end of the week, holding to a 170 pip weekly gain. The Kiwi dollar was broadly stable on most crosses. Last week’s GDP report showed that the New Zealand economy is steadily cooling down. That’s entirely to be expected in the wake of more than 500 basis points of cash rate increases over the last two years. New Zealand’s GDP dipped by 0.1% in the March quarter. That was in line with the average market forecast, but a little stronger than our pick of a 0.4% fall. However, downward revisions to previous quarters meant that annual growth was right in line with our forecast at 2.2%. On the technical level, immediate support is seen at 0.6218, followed by the 0.6200 psychological mark and the 200-day SMA at 0.6150. On the other hand, resistances line up at 0.6250, followed by 0.6300 (May 12 high) and the 0.6230 area.

Looking at the week ahead and New Zealand and today we will see the release of the Business NZ Services Index. On Tuesday we will see the release of the Westpac Consumer Sentiment, a survey of about 1,500 consumers which asks respondents to rate the relative level of past and future economic conditions, including personal financial situation, climate for major purchases, and overall economic situation. Finally on Thursday Statistics New Zealand will release the latest Trade Balance figures, while the Reserve Bank of New Zealand will release Credit Card Spending report.