NZD underperforms despite US dollar softness
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Daily Currency Update
The New Zealand dollar underperformed through trade on Wednesday, testing a break below US$0.5850 amid broader US dollar softness. US treasury yields edged higher early, dragging the dollar with them and forcing the NZD to mark an intraday low just above US$0.5830. Having broken key technical supports, the NZD appeared poised to test November’s earlier lows, but found support and pushed back above US$0.5860 leading into the daily close as treasury yields retraced gains. A consolidated break below US$0.5855/60 could well bring into play another move toward US$0.58. In the absence of major market moving data, our attentions turn to commentary from Federal Reserve Chair, Jerome Powell, for any guidance on Fed pricing leading into the December policy meeting.Key Movers
The US under performed against most major counterparts on Wednesday as weaker than anticipated ISM services data and moderate leading payroll indicators forced Treasury yields to drift lower. The ISM services index was weaker than expected and well below the lowest market estimate. Policy uncertainty and looming tariffs elevated market nerves. The euro clawed its way back above 1.05 while the pound tested a break above 1.07. With US treasury yields lower, the yen fought off a break above 151 while the Chinese yuan pushed the dollar back toward 7.26. In other news, the South Korean won has recovered much of yesterday’s losses after President Yoon lifted orders for the imposition of Martial Law.Our attentions today turn to commentary from Jerome Powell ahead of tomorrow’s all important US non-farm payroll print.
Expected Ranges
- NZD/USD: 0.5800 - 0.5900 ▼
- NZD/EUR: 0.5500 - 0.5600 ▼
- GBP/NZD: 2.1500 - 2.1900 ▲
- NZD/AUD: 0.9050 - 0.9150 ▲
- NZD/CAD: 0.8200 - 0.8300 ▼