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NZD retakes 0.68 after 0.37% jump

Wednesday 5 January, 2022

Daily Currency Update

The New Zealand dollar reversed course overnight to regain most of the ground lost on Monday. Opening this morning at 0.6809, the Kiwi enjoyed an impressive 0.37% rally spurred on by bullish equity and commodity markets. Positivity permeated markets on Tuesday, with Wall Street leading the charge. Most equity indexes traded in the green with the notable exception of the NASDAQ. Commodity prices were also healthy with gold in particular bouncing strongly after collapsing at the beginning of the day. The bullish sentiment extended across to the Kiwi and supported it through intraday trade to retake the 0.6790 level. Ultimately, however, it was the less than expected result from US PMI data that saw the Kiwi climb to as high as 0.6823 before settling at today's open. Moving into Thursday, the Kiwi enjoys a quiet day on the economic calendar and looks offshore for direction. All eyes will look to the United States Non-Farm Employment Change and FOMC Meeting Minutes for impetus.

Key Movers

The United States dollar was a key market mover overnight, losing ground significantly against most of the major currency pairs after the ISM US Manufacturing PMI was released. The report showed an expansion at 58.7 but was ultimately lower than analysts' expectations of 60. US manufacturing appears to have taken a breath as supply logjams and a slight cooling of demand conspired to ease manufacturing demands and potentially inflation concerns. Despite the PMI reading, The Greenback also saw significant movement against the safe-haven currency, the Japanese yen. The pair opens this morning 0.7% higher at 116.134, its highest point in more than 4 years. The catalyst was US bond yields, which climbed significantly this week on interest rate hike expectations and saw a move away from the safe-haven.

Expected Ranges

  • NZD/USD: 0.6767 - 0.6848 ▼
  • NZD/EUR: 0.5994 - 0.6067 ▲
  • GBP/NZD: 1.9743 - 1.9982 ▲
  • NZD/AUD: 0.9344 - 0.9457 ▼
  • NZD/CAD: 0.8597 - 0.8699 ▼