Daily Currency Update
NZD - New Zealand DollarFollowing the NZD/USD rally on Wednesday based on the surprise decision by the RBNZ to leave the policy rate unchanged the pair paused around the 0.6420 level on Thursday and has been unable to extend its rally as the US-China trade worries resurfaced again. The two sides are at a stalemate despite saying a month ago they had an agreement in principle, reports said that while President Donald Trump has agreed to buy $50 billion a year of U.S. soybeans, pork and other farm products, China is wary of making a numerical commitment in the text of the agreement. The NZD/USD has slid back and has settled around the 0.6368 level this morning. Looking ahead, the Business NZ Purchasing Managers Index (PMI) will be looked upon by traders for fresh catalysts. Adopting a technical viewpoint, we would expect to see support on moves approaching 0.6325 followed by 0.6300. Resistance can be seen at 0.6400 and 0.6440-50.
Key Movers
The US Dollar Index which measures the strength of the Greenback against a basket of six major currencies has taken a fall as the number of Americans applying for unemployment benefits rose to an unexpected five-month high. Initial jobless claims rose 14,000 to a seasonally adjusted 225,000 in the seven days ended Nov. 9. That’s the highest level since late June. Meanwhile, Federal Reserve Chairman continued speaking to Congress on Thursday, the Fed expects to see continued growth and that a slowdown in manufacturing is being offset by strong consumer spending.Over in the U.K, retail sales dropped for the month of October by 0.1 percent which was a surprise in the run-up to Christmas and shows that shoppers had become reluctant to spend in the lead up to the Brexit deadline. There was also speculation that recent declines in employment and wages growth had deterred consumers from spending on big-ticket items such as furniture and cars. GBP/USD is currently buying 1.2879.
Expected Ranges
- NZD/USD: 0.6300 - 0.6420 ▼
- NZD/AUD: 0.9335 - 0.9435 ▲
- GBP/NZD: 1.9950 - 2.0300 ▼
- NZD/EUR: 0.5730 - 0.5830 ▼
- NZD/CAD: 0.8390 - 0.8510 ▼