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New Zealand Dollar range bound ahead of ANZ Business Confidence

NZD - New Zealand Dollar

The New Zealand Dollar finished the week higher against the greenback due to a combination of US-China trade war once again hitting a few roads blocks and the RBNZ policy makers saying they did “not warrant a significant change to the monetary policy outlook”. The NZD/USD was relatively range-bound on Friday moving between a low of 0.6279 and a high of 0.6310. The latest reported in the US-China trade war was the Trump administration were discussing ways to limit US investors portfolio flows into China, the move would have repercussions for billions of dollars in investment pegged to major indexes.

Looking ahead, locally we see the release of ANZ Banks Business Confidence survey, this is a report closely watched by the RBNZ as it provides clues to the country’s current and future economic activity such as spending, hiring and investment. August’s reading came in at a net 52.3 which was the weakest since 2008, today economist are expected a further drop to -58.5.

On the technical front, the Kiwi is currently trading at 0.6293, we continue to see 0.6270 as near-term support followed by 0.6250. On the upside, resistance is sitting at 0.6340.

Key Movers

The US Dollar Index hit a new high for the year on Friday touching 99.31 against a basket of major currencies before it witnessed a pullback following the release of Consumer Spending and Durable Goods. Consumer spending rose a small 0.1% last month while goods orders a tiny 0.2%. The number suggests the US economy is cooling from a strong second quarter. Over in the UK, GBP/USD closed the week with a downfall at 1.2284 with likely weakness to continue this week as the Prime Minister has been accused of working for the interest of hedge funds and is also facing a police investigation over alleged favours to an American businesswomen. The EUR/USD touched a near multi-year low of 1.0904 on Friday and local data didn’t do too much to help’s it cause, Import Prices fell sharply in Germany in August, while the EU Economic Sentiment Indicator fell to 101.7 in September, much worse than the 103.00 anticipated.

Expected Ranges

NZD/USD: 0.6250 - 0.6330 ▼

NZD/AUD: 0.9260 - 0.9340 ▼

GBP/NZD: 1.9400 - 1.9750 ▼

NZD/EUR: 0.5680 - 0.5780 ▼

NZD/CAD: 0.8290 - 0.8380 ▼