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NZD/USD little changed despite rising US equities

Friday 3 December, 2021

Daily Currency Update

Thursday’s session saw the New Zealand dollar trade sideways against its US counterpart, oscillating between 0.6800 and 0.6830 throughout trade. It was a similar story for the AUD which traded between 0.7085 and 0.7115, seeing the AUD/NZD cross rate slip slightly from 1.0440 to 1.0408. This currency market calmness was in contrast to rising US equities, with the S&P500 index rising 1.5% and bond yields also slightly higher. Today we have a raft of PMI’s due out. Firstly out of Japan which is expected to show some post-Delta improvements, a robust report is also expected out of China’s Caixin Services PMI, and lastly, we get Markit Services PMI’s for the Eurozone and the UK. We will also get retail sales data for Europe before focus shifts to the key risk event for the day in the form of US non-farm payrolls. On the technical front, NZD/USD is still a victim of negative momentum having broken supports in the low 0.68’s with the door now open to testing supports around the 0.6770 handle.

Key Movers

As we touched on above, after a volatile few sessions, moves in currency markets have been quite restrained overnight despite the sharp rise in US equities. We’re expecting markets to remain volatile given the uncertainty surrounding the Omicron variant and its associated risks to growth and global mobility. In commodities, we saw crude oil futures rising 0.9% to just under $70, copper rose over 1% and gold and iron ore both fell 1% and 2.5% respectively. Iron ore is now trading at $100.

Expected Ranges

  • NZD/USD: 0.6780 - 0.6830 ▼
  • NZD/EUR: 0.5970 - 0.6050 ▼
  • GBP/NZD: 1.9469 - 1.9600 ▲
  • NZD/AUD: 1.0385 - 1.0430 ▼
  • NZD/CAD: 0.8700 - 0.8750 ▲