Home Daily Commentaries New Zealand dollar holds above 59 US cents

New Zealand dollar holds above 59 US cents

Daily Currency Update

The Kiwi dollar is slightly weaker this morning when valued against the Greenback. The NZD/USD pair on Friday traded higher around the 60 US cent level following the US Dollar's broad-market fallback, sending the pair back into the week's opening bids. The NZD/USD pair rallied 2.2% higher from the week's bottom near 0.5875. However, the Kiwi dollar was unable to hold on to those gains after the US Non-Farm Payrolls (NFP) figures came in well above expectations. September's bottom of 0.5845 still remains a key technical floor, but the pair is still well off recent highs, down 6.7% from July's peak into 0.6415. The NZD/USD is currently trading at 0.5958 at the time of writing.
On the local data front, it’s a quiet one in New Zealand with no scheduled releases on Monday. On Wednesday Statistics New Zealand will release the latest monthly Visitor Arrivals. Tourism plays an important role in the economy, about 7% of the population is employed by the tourism industry, and a sizable portion of the nation's GDP is indirectly related to tourism. On Thursday we will see the release of the monthly Food Price Index (FPI). Although food is among the most volatile consumer price components, this indicator garners some attention because New Zealand's major inflation data is released on a quarterly basis. On Friday we will see the release of the BusinessNZ Manufacturing Index.

Key Movers

On Friday in the United States (US) we saw upbeat US job growth in September. The US labor force witnessed 336K fresh payrolls, much higher than estimates of 170K and the former release of 227K. The jobless rate remains steady at 3.8%, nominally higher than expectations of 3.7%. The monthly wage rate grew by 0.2% but was lower than expectations of 0.3%. The annualized wage rate decelerated to 4.2% vs. the estimates and the former release of 4.3%. The 10-year US Treasury yield stands above 4.70%, close to the highest level since 2007.
The Pound Sterling (GBP) rallied for the third consecutive day against the US Dollar (USD) on Friday as the North American session began to wind down ahead of the weekend. Although September’s Nonfarm Payrolls report was positive, the GBP/USD recovered after reaching multi-month lows of 1.2037 and has risen more than 1.70% towards 1.2240s. On the UK front speculations about a stagnating economy have trimmed the odds for additional tightening by the Bank of England (BoE), even though its Governor, Andrew Bailey, commented that inflation at around 6.7% would continue to fall amidst rates staying at around 5.25%.

Expected Ranges

  • NZD/USD: 0.5845 - 0.6045 ▼
  • NZD/EUR: 0.5530 - 0.5730 ▼
  • GBP/NZD: 2.0250 - 2.0450 ▲
  • NZD/AUD: 1.0500 - 1.0700 ▲
  • NZD/CAD: 0.8000 - 0.8200 ▲