NZDUSD edges higher as dip-buyers step in near 0.5800, extending gains for the fifth consecutive day
Written by
Daily Currency Update
The NZDUSD pair attracted dip-buyers during Thursday’s Asian session, finding support near the 0.5800 level and pushing into positive territory for the fifth consecutive day. The currency pair is currently trading in the 0.5800 to 0.5830 range, just a few pips shy of its weekly high. This upward momentum follows a recent recovery from a low not seen since April 10, which the pair touched last week amid broad weakness in the US dollar (USD). The bearish sentiment around the USD has provided a favourable backdrop for the New Zealand dollar (NZD), helping the pair regain lost ground. Market participants appear to be capitalising on dips around key support levels, suggesting confidence in the NZD’s near-term outlook. The steady gains come as investors weigh ongoing economic data releases and central bank signals from both New Zealand and the United States. Looking ahead, traders will be watching for fresh cues from the Reserve Bank of New Zealand (RBNZ) and the US Federal Reserve, as their respective monetary policies remain crucial drivers of NZDUSD’s direction. Additionally, broader risk sentiment and commodity price trends—particularly those linked to New Zealand’s export sectors—will also influence the pair’s trajectory. Overall, NZDUSD seems poised to build on its recent recovery, provided the US dollar remains under pressure and New Zealand’s economic indicators maintain a positive tone.Key Movers
The US Dollar Index (DXY), which tracks the value of the US dollar compared to a group of major foreign currencies, is having a hard time building on a small gain it made overnight. This small gain came after the dollar hit a one-week low, but overall, the dollar isn’t strengthening much right now. One main reason for this is that many investors expect the US Federal Reserve to lower interest rates two more times before the end of the year. Lower interest rates usually make a currency less attractive to investors, which can weaken its value. These expectations grew stronger after new data on US jobs came out on Wednesday, and the report wasn’t good. It showed that private companies actually lost 32,000 jobs in September, which is the biggest drop since March 2023. This was surprising because most months, the US economy adds jobs. Additionally, the previous month’s job numbers for August were revised downward. Originally, it was reported that 54,000 jobs were added in August, but the revised data now shows that the US lost 3,000 jobs instead. This suggests the labor market is not as strong as many thought. On the other hand, there was some slightly positive news from the Institute for Supply Management (ISM), which measures business activity in the manufacturing sector. Their Purchasing Managers' Index (PMI) rose from 48.7 in August to 49.1 in September. While this is still below 50 (which indicates contraction), the increase suggests a small improvement in economic activity. Meanwhile, even though the US is experiencing a partial government shutdown—a situation that often causes uncertainty and worry—investors seem relatively calm. This is shown by the mostly positive performance in the stock markets, where traders appear confident despite the political issues. In summary, the US dollar is weak because of worries about the economy and expectations for rate cuts, job reports show signs of a slowing labor market, but some business activity is improving slightly, and markets aren’t too shaken by government shutdown concerns.Expected Ranges
- NZD/USD: 0.5700 - 0.5900 ▲
- NZD/EUR: 0.4850 - 0.5050 ▲
- GBP/NZD: 2.3050 - 2.3250 ▼
- NZD/AUD: 1.1200 - 1.1400 ▼
- NZD/CAD: 0.8000 - 0.8200 ▲