Daily Currency Update

Get access to our expert daily market analyses and discover how your currency has been tracking with our exchange rate tools

Kiwi falls below 0.65 ahead of the FOMC policy update on Thursday morning

NZD - New Zealand Dollar

The New Zealand dollar opens weaker this morning when valued against the Greenback, falling to an overnight low of 0.6491 below the 0.65 mark. It has been a quiet start to an action-packed week for the Kiwi with focus firmly directed towards the Federal Open Market Committee (FOMC) policy update on Wednesday. On the release front yesterday NZ services index rose in the month of May which came as a relief following last week’s soft manufacturing PMI release. Looking ahead today there are only second tier releases which shouldn’t cause much market reaction with the release of the Westpac Consumer Sentiment which is a leading indicator of consumer spending. On Thursday we will see the release of Gross Domestic Product (GDP).

From a technical perspective, the NZD/USD pair is currently trading at 0.6497. We continue to expect support to hold on moves approaching 0.6480 while now any upward push will likely meet resistance around 0.6520.

Key Movers

The U.S. dollar was roughly unchanged on Monday with focus firmly directed towards the Federal Open Market Committee (FOMC) policy update on Wednesday with expectations the U.S. Federal reserve will keep official cash rates on hold at 2.5 per cent. However, on the back of slow jobs growth in May bets for monetary easing at its July meeting remain elevated, with markets pricing in a 67.9% chance of a 25 basis point cut. On the data front in the US last night we saw the release of the NY Empire State Manufacturing Index for the month of June which disappointed with -8.6 in June vs. the previous 17.8 and the expected 10.0. We also saw the release of the NAHB Housing Market Index for the same month which resulted at 64 vs. the expected 67. Looking ahead tonight in the US will see the release of May Housing Starts and Building Permits.

The Great British Pound was among the worst performers against the greenback overnight falling to 1.2552, a level not seen since last January, with the UK's political uncertainty was the main reason behind the decline. Conservative MPs will have another ballot this Tuesday, and the list will be reduced by at least one, with those with less than 32 votes also being removed from the next round of voting. There are no macroeconomic releases scheduled in the UK. From a technical perspective, the GBP/USD pair is currently trading at 1.2537. We continue to expect support to hold on moves approaching 1.2510 while now any upward push will likely meet resistance around 1.2605.

Expected Ranges

NZD/USD: 0.6400 - 0.6600 ▼

NZD/AUD: 0.9400 - 0.9600 ▲

GBP/NZD: 1.9200 - 1.9400 ▼

NZD/EUR: 0.5700 - 0.5900 ▼

NZD/CAD: 0.8600 - 0.8800 ▼