Kiwi dollar softens in spite of a ‘risk-on’ mood among investors
Tuesday 20 August, 2019
Daily Currency UpdateNZD - New Zealand DollarThe New Zealand dollar is weaker this morning when valued against the Greenback as worldwide indexes closed in the green, with US ones led by tech-related shares, up after the US White House decided to extend Huawei’s temporary license for 90 days. The Kiwi dollar has traded mostly within a tight 0.6410-0.6430 range and currently sits near the bottom of that. Looking ahead today and the only data release of note was the NZ Performance of Services index which pushed higher to a slightly above-average. Tonight we will see the release of the GDT dairy auction is expected to be on the soft side, with prices down in the order of 2%. From a technical perspective, the NZD/USD pair is currently trading at 0.6410. We continue to expect support to hold on moves approaching 0.6400 while now any upward push will likely meet resistance around 0.6430.
Key MoversThis week has begun with a positive vibe, with some US companies allowed to do business with Huawei for a further 90 days. The US macroeconomic calendar had nothing to offer on Monday. However US President Donald Trump reiterated that the Federal Reserve needs to cut rates by 100 basis points, for the economy to do “even better.” The Greenback advanced in the afternoon as Federal Reserve Bank of Boston President Eric Rosengren said that he does not see a lot of need to take action on monetary policy. Rosengren, a voter this year on the Federal Open Market Committee, was one of two officials who dissented when the panel cut rates on July 31. Minutes of last month’s meeting will be released at 2 p.m. in Washington on Wednesday.The Pound Sterling edged lower on Monday, although sentiment towards the pound was better than in recent sessions as investors hoped Britain and the European Union could make some progress in Brexit talks. From a technical perspective, the GBP/USD pair ended Monday marginally lower in the 1.2130 price zone a couple of pips below Friday’s high. The GBP/USD pair is currently trading at 1.2126. We continue to expect support to hold on moves approaching 1.2100 while now any upward push will likely meet resistance around 1.2170.
- NZD/USD: 0.6300 - 0.6500 ▼
- NZD/AUD: 0.9350 - 0.9550 ▲
- GBP/NZD: 1.8800 - 1.9000 ▲
- NZD/EUR: 0.5650 - 0.5850 ▼
- NZD/CAD: 0.8450 - 0.8650 ▲