New Zealand dollar remains steady trading below 57 US cents
Friday 21 October, 2022
Daily Currency UpdateThe New Zealand dollar is steady this morning when valued against the Greenback with currency moves relatively restrained overnight. The Kiwi dollar traded as high as 0.5740, a two-week high, but it has since pulled back to around 0.5680 as risk appetite has faltered. On the data front yesterday the Reserve Bank of New Zealand released its Statement of Intent and Statement of Performance Expectations, outlining what it intends to do to support economic wellbeing and prosperity for all New Zealanders and how it will measure its performance. The Statement of Intent (SoI) covers the period 2022-2026, while the Statement of Performance Expectations (SPE) 2022/2023 is a new requirement under the Reserve Bank of New Zealand Act 2021. The Statement, setting out the strategic intentions and how they intend to reduce consumer price inflation back to within the target range, was a key priority. Looking ahead today and NZ Trade Balance data will be of utmost importance. As per the consensus, the annual fiscal deficit will trim to $-13.19B vs. the prior release of $-12.28B. An occurrence of the same may bring volatility for the kiwi bulls.
Key MoversOvernight, UK Prime Minister Liz Truss announced her resignation after a month and a half in power. Liz Truss will become the shortest-serving prime minister in Britain's history after bowing to pressure from her own MPs to resign following a disastrous start to her premiership. It follows weeks of plummeting opinion polls and turmoil in financial markets following her government's mini-budget at the end of last month. She will remain as prime minister until a leadership election is completed within the next week to find her replacement, and there's speculation Boris Johnson is considering a bid to return to the top job. Ms. Truss, who has been in power for just 45 days, will become the shortest-serving prime minister in Britain's history – George Canning previously held the record, serving 119 days in 1827 before he died.
The Great British pound overnight has given away most of the ground taken after the announcement of Prime Minister Truss's resignation and remains practically unchanged. The GBP/USD pair rallied to session highs at 1.1330, with the market celebrating the departure of Truss’s controversial government, to lose steam shortly afterward and return to the lower ranges of 1.1200. The euro also pairing losses with the British pound retreating from session highs as the dust from UK PM Liz Truss's resignation settles. The EUR/GBP pair found support at 0.8675 to reach 0.8715 at the moment of writing.
- NZD/USD: 0.5600 - 0.5800 ▼
- NZD/EUR: 0.5700 - 0.5900 ▼
- GBP/NZD: 1.9700 - 1.9900 ▲
- NZD/AUD: 1.0950 - 1.1150 ▼
- NZD/CAD: 0.7700 - 0.7900 ▼