New Zealand dollar continues to trade above 65 US cents
Monday 6 June, 2022
Daily Currency UpdateThe New Zealand dollar closed the week stronger against the Greenback holding around US$0.6550c on Friday, lifted by a global rally in risk assets and expectations of domestic interest rate increases. The kiwi dollar also benefited from a recent slide in the greenback, as mixed economic data muddied the outlook for US monetary policy. Last Wednesday the Reserve Bank of New Zealand (RBNZ) raised the official cash rate by 50 basis points to 2.0%, a level not seen since November 2016. Crucially, a hawkish RBNZ now projects the cash rate will double to 4.0% over the next year and remain there into 2024.
Looking ahead this week and New Zealand banks will be closed today in observance of the Queen’s Birthday. On Tuesday we will see the release of Monthly ANZ Commodity Prices, which measures the change in the global price of exported commodities. On Wednesday we will see the release of the Global Dairy Trade (GDT), a leading indicator of the nation's trade balance. On Friday, to close the week, we will see the release of New Zealand quarterly Manufacturing Sales.
Key MoversUS stocks fell broadly and pulled major indexes into the red for the week, as Wall Street focused on the downside of the still-strong US jobs market. The Jobs data showed employers hired more workers last month than economists expected. While that’s a good sign for the economy amid worries about a possible recession, many investors saw it keeping the Federal Reserve on its path to hiking interest rates aggressively. Friday’s report from the US government showed employers added 390,000 jobs last month, better than expectations for 322,500. The Dow Jones Industrial Average fell 348.58 points, or 1 per cent, to 32,899.70. The Nasdaq fell 304.16 points, or 2.5 per cent, to 12,012.73. The S&P 500 index fell 68.28 points, or 1.6 per cent, to 4,108.54.
Looking ahead this week and the US will release March Durable Goods Orders, foreseen up 1% MoM, and the preliminary estimate of the Q1 Gross Domestic Product, expected to post a modest 1% gain. By the end of the week, the focus will shift to the core Personal Consumption Expenditures Price Index.
- NZD/USD: 0.6410 - 0.6610 ▲
- NZD/EUR: 0.5970 - 0.6170 ▲
- GBP/NZD: 1.9080 - 1.9280 ▼
- AUD/NZD: 1.0970 - 1.1170 ▼
- NZD/CAD: 0.8100 - 0.8300 ▲