Home Daily Commentaries New Zealand dollar holds steady around 69 U.S. cents

New Zealand dollar holds steady around 69 U.S. cents

Daily Currency Update

The New Zealand dollar is slightly weaker this morning when valued against the Greenback trading just below the 70 U.S. cents. The NZD/USD pair witnessed some selling on Thursday but seems to have stalled its recent bullish trend closer to the key 0.7000 psychological mark. The downtick was exclusively brought on by a broad-based US dollar strength, underpinned by the US Federal Reserve’s hawkish monetary policy outlook. Overnight movements in other currencies have been more modest however the Kiwi dollar underperform the NZD/AUD cross has fallen to its lowest level since last June at around 0.9250. On a technical perspective, the NZD/USD pair is currently trading at 0.6958. We continue to expect support to hold on moves approaching 0.6935 while now any upward push will likely meet resistance around 0.6980.

On the data front yesterday there were no scheduled releases. The economic calendar in New Zealand is empty for the remainder of this week.

Key Movers

The key mover in the market overnight was the weakness in the Japanese Yen. The USD/JPY pair is up around 1% from yesterday and has broken above 122 for the first time since late 2015. The recent appreciation in USD/JPY has been primarily driven by the surge in US Treasury yields which, along with the Bank of Japan holding their official cash rates has led to a sharp widening in US-Japan interest rate differentials.  The Japanese Yen has been on an astounding run of weakness over the past two weeks, with multi-year highs printing in all of USD/JPY, AUD/JPY and CAD/JPY, as other economies gear up for rate hikes to fight inflation. The Australian dollar is currently stronger this morning when valued against the Japanese Yen trading at 91.82.  While the NZD/JPY has reached 85, its highest level since mid-2015.

Expected Ranges

  • NZD/USD: 0.6850 - 0.7050 ▼
  • NZD/EUR: 0.6200 - 0.6400 ▼
  • GBP/NZD: 1.8800 - 1.9000 ▲
  • NZD/AUD: 1.0650 - 1.0850 ▼
  • NZD/CAD: 0.8650 - 0.8850 ▼