NZD resilient in face of broadly stronger USD
Wednesday 17 May, 2023
Daily Currency UpdateDespite a slew of macroeconomic data releases price action across major currencies was well contained Tuesday allowing the NZD to track within a well-defined and narrow 30-point range. Having opened just short of US$0.6260 the NZD tracked lower through the domestic session as weaker Chinese data weighed on the yuan and spilled over into the NZD and AUD. Retail sales, industrial production and investment all missed to the downside pushing the NZD toward intraday lows at US$0.6225. With the NZD showing some stout resilience in the face of a broadly stronger USD we open this morning higher against key major counterparts. Higher NZ rates and calls for a peak OCR of 6% helped drive gains against the AUD with the NZD pushing back through A$0.9350 while enjoying small gains against the GBP and yen as well.
With little of note on today's domestic ticket, our attentions turn to Australian wage data, Japanese Q1 GDP and US housing starts for direction through the day.
Key MoversA slight risk-off bias and higher US treasury yields helped the USD rebound through trade on Tuesday, advancing against major counterparts. Mixed domestic data sets coupled with weaker Chinese activity data and ongoing uncertainty surrounding Debt ceiling negotiations weigh on risk demand propping up the USD. The yen and euro both tracked lowed while softer than anticipated UK Labour data prompted a larger fall for the GBP. Surprisingly Canadian CPI edged higher in April, up 4.4% year on year, elevating calls for the Bank of Canada to resume tightening. The promise of higher rates helped the CAD outperform, jumping to mark intraday highs just short of US$0.7460.
Attentions turn now to Japanese Q1 GDP data and US housing starts for direction through Wednesday.
- NZD/USD: 0.6180 - 0.6280 ▼
- NZD/EUR: 0.5700 - 0.5800 ▼
- GBP/NZD: 1.9920 - 2.0120 ▼
- NZD/AUD: 0.9280 - 0.9420 ▲
- NZD/CAD: 0.8360 - 0.8450 ▼