NZD pushes back above 0.65 US cents as Kiwi outperforms its G10 counterparts
Friday 3 July, 2020
Daily Currency UpdateNZD - New Zealand DollarThe New Zealand dollar outperformed through trade on Thursday, pushing through resistance at 0.65 to touch intraday highs at 0.6529. With no headline macroeconomic data at hand and little change in the broader coronavirus narrative, there appeared little catalyst for the NZD upturn outside of a delayed response to the recent risk-on move across equity markets. With moves across G10 currencies largely contained, the Kiwi’s upturn extended to other major counterparts, pushing through 0.94 against the AUD while testing a break back above 70 against the Japanese yen. Having touched intraday highs, the NZD did shift lower in the wake of US non-farm payroll data and a broad-based USD uptick, but still opens this morning above 0.65 US cents.Attentions today remain affixed to coronavirus headlines with volumes likely to be thin as the US enjoys a public holiday in observance of 4th of July . While volatility has eased of late and moves across currency markets remain muted, the NZD should remain well supported on dips approaching 0.64 while upturns approaching 0.6550/.66 will continue to meet resistance through the short-term.
Key MoversCurrency markets remained subdued through trade on Thursday, with G10 currencies confined to tightening ranges as the risk-on rally enjoyed across equity markets failed to spill into other financial asset classes. The US dollar index edged higher as stronger than anticipated US non-farm payroll data bolstered hopes of a swift rebound in economic activity. The US economy added nearly 5 million new jobs in June, well above median estimates and a strong sign that with re-opening comes improvement in labour market indicators. Despite strong gains in hospitality and leisure, the data was not all positive. Unemployment still remains high and over 11%, while the number of workers now unemployed who were previously subject to temporary layoffs increased by nearly 3 million. This shift in employment status from temporary to full time is worrying as it suggests underlying business are struggling to cope with the extended lock down period. With many US states now re-introducing strict social distancing measures in a bid to curtail the rapid spread of the virus, June’s strong performance could simply be nothing more than a false dawn. Attentions today remain squarely affixed to broader risk trends with coronavirus headlines dominating direction.
- NZD/USD: 0.6430 - 0.6580 ▲
- NZD/EUR: 0.5730 - 0.5820 ▲
- GBP/NZD: 1.9020 - 1.9280 ▼
- NZD/AUD: 0.9330 - 0.9450 ▲
- NZD/CAD: 0.8750 - 0.8880 ▲