NZD maintains narrow range in absence of headline data updates
Thursday 9 February, 2023
Daily Currency UpdateThe NZD failed to consolidate on early gains and push beyond US$0.6350, drifting lower amid an overnight souring in risk demand. Having opened near US$0.6320 the NZD advanced in the wake of commentary from Fed chair Jerome Powell, pushing toward intraday highs at US$0.6345 before tracking lower and testing a break below US$0.63. In the wake of Fed Chair Jerome Powell’s address another wave of Fed speakers affirmed the FOMC’s commitment to a higher peak funds rate. This promise of higher rates put downward pressure on global equities, dampening demand for risk and subsequently capping near term NZD gains. With little of note on today’s macroeconomic ticket our attentions remain with Fed speak and shifting policy expectations. We anticipate the NZD will continue to find support on moves below US$0.6290 while resistance approaching US$0.6350/64 should hold.
Key MoversThere has been little movement across major currencies through trade on Wednesday as markets appear content in digesting a blockbuster week of headline data shocks and key central bank policy updates. The USD showed little net change across key indices while the Euro maintains a narrow 50 point handle and the GBP failed to extend a break beyond 1.21. Risk sentiment faded through the day as global rates climbed. Against this backdrop of higher rates the USD clawed its way toward 131.50 against the JPY yet offered little meaningful sign it would extend the advance. With little of note on today’s calendar direction will continue to be dictated by shifting global rate expectations. After last week’s sharp price corrections we anticipate a period of consolidation as markets reassess positions.
- NZD/USD: 0.6280 - 0.6360 ▼
- NZD/EUR: 0.5850 - 0.5920 ▼
- GBP/NZD: 1.8980 - 1.9220 ▲
- NZD/AUD: 0.9020 - 0.9150 ▲
- NZD/CAD: 0.8420 - 0.8520 ▲