Home Daily Commentaries NZD range bound as attentions turn toward next weeks Election

NZD range bound as attentions turn toward next weeks Election

Tuesday 5 September, 2023

Daily Currency Update

The New Zealand dollar maintained a narrow trading handle through Monday, amid a lack of headline newsflow and macroeconomic data. With US markets closed in observance of Labor Day, weekend price action across currency markets was muted with analyst content to sideline major bets. China sentiment improved as officials took steps to help boost consumption and the beleaguered property market. Last week, policymakers moved to lower mortgage down payment requirements and lowered mortgage rates helping boost demand across the housing market. New home sales jumped at the weekend, up from the previous week and significantly improved on what can only be described as a disastrous August. The improved activity helped sure up the Yuan, supporting the NZD on moves approaching US$0.5930. Having tracked between US$0.5930 and US$0.5960 the NZD opens this morning near US$0.5940, marginally lower than last week’s close.

Our attention now turns to the RBA policy update and China's service data, ahead of next week's all-important Election.

Key Movers

With US markets closed in observance of Labor Day, there was very little price action across major currencies through Monday. Most majors maintained a narrow trading handle and all units sit within three-tenths of a percent when measured against Friday’s close. Sterling was the day's best performer, climbing through 1.26 to touch 1.2630 while the Euro continues to face near-term pressures, struggling on moves above 1.8050 and seemingly poised to consolidate a break below 1.08.

Our attention turns now to China service data, as a key measure of sentiment. With little else of note on Tuesday's docket, we look to US ISM service data on Wednesday and China's inflation data on Friday as the big-ticket macro items guiding direction through the rest of the week.

Expected Ranges

  • NZD/USD: 0.5890 - 0.6020 ▼
  • NZD/EUR: 0.5450 - 0.5550 ▼
  • GBP/NZD: 2.1100 - 2.1300 ▲
  • NZD/AUD: 0.9150 - 0.9280 ▼
  • NZD/CAD: 0.8020 - 0.8120 ▼