Daily Currency Update

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New Zealand dollar continues to gain ground against the US dollar

NZD - New Zealand Dollar

The New Zealand dollar continues to gain ground against the Greenback. Currently the Kiwi dollar is trading above US72¢, up slightly 0.07% on the day. The NZD/USD pair has climbed 0.85% so far this week against the Greenback. On the data front yesterday business confidence improved to -2, up from the preliminary reading of -8.4 points. With the global demand growth for New Zealand commodities and stable domestic activity, we would expect business confidence to continue to improve in the coming months. New Zealand’s headline Trade Balance eased to $33M and $1.69B respectively on MoM and YoY during March, versus upwardly revised $201M and $2.38B previous readouts in that order. Further details suggest that the Imports grew beyond $4.3B to $5.65B, whereas Exports also rose past $4.5B earlier readings to $5.68B during the stated month.

There are no scheduled releases in New Zealand today. From a technical perspective, the NZD/USD pair is currently trading at 0.7240. We continue to expect support to hold on moves approaching 0.7205, while any upward push will likely meet resistance around 0.7270.

Key Movers

Overnight India’s total COVID-19 cases have passed 18 million after another world record number of daily infections. India reported 379,257 new infections and 3645 new deaths on Thursday, as health ministry data showed, the highest number of fatalities in a single day since the start of the pandemic. The world’s second most populous nation is in a deep crisis, with hospitals and morgues currently overwhelmed. Although India is the world’s biggest producer of vaccines, it does not have the stocks for the estimated 800 million now eligible.

On the data front yesterday, in the US preliminary estimates for the first quarter Gross Domestic Product came in at 6.4%, beating expectations. The Greenback, however, was unable to take advantage of the encouraging headline, instead pressured by risk-appetite. Initial Jobless Claims, which fell to 553,000, the lowest level since the pandemic began. Next week, the US will release Non-Farm Payrolls for April. Current expectations are for +900,000 jobs to have been added to the economy. Looking ahead today and the US will publish March Personal Income and Personal Spending, and the final reading of the April Michigan Consumer Sentiment Index, expected to be upwardly revised to 87.5.

Expected Ranges

NZD/USD: 0.7150 - 0.7350 ▼

NZD/EUR: 0.5870 - 0.6070 ▲

GBP/NZD: 1.9100 – 1.9350 ▲

NZD/AUD: 1.0600 - 1.0800 ▼

NZD/CAD: 0.8800 - 0.9000 ▼