New Zealand Dollar Forecast: NZD/USD Testing Key Moving Average As Price Rebounds

THURSDAY’S ASIA-PACIFIC OUTLOOK

The New Zealand Dollar gained against the US Dollar overnight, putting in the third consecutive rise since falling to a multi-month low following last week’s Federal Reserve rate decision. The risk-sensitive currency has also been bolstered by a rebound in commodity prices. Copper is up nearly 4% this week, joined by higher crude oil prices.

Today’s Asia-Pacific session will see Japan release foreign bond investment figures for the week ending June 19 cross the wires. Japan has made progress in its fight against Covid within its borders, but government officials have become increasingly concerned over the Olympic Games’ potential impact on its progress. A second Ugandan team member tested positive for Covid. The Ugandan delegation is currently being quarantined until July 3.

Elsewhere, Wall Street closed largely unchanged, but volatility fell for a third consecutive session via the S&P 500’s VIX ‘fear gauge.’ Traders are weighing the risks of the Federal Reserve reducing its balance sheet sooner than previously expected. Wednesday, Raphael Bostic, President and Chief Executive Officer of the Federal Reserve Bank of Atlanta stated:

“Given the upside surprises in recent data points, I have pulled forward my projection for our first move to late 2022.”

The Treasury market reflected the narrative for a sooner-than-expected pullback in monetary support for the economy, with the benchmark 10-year note’s yield rising two and a half basis points. The US Dollar benefited from the sentiment. Although the DXY index only managed to gain 0.10% as the New York closing bell rang.

Later this week, New Zealand will report trade figures for May. The island nation saw exports and imports at N$5.37 billion and N$4.98 billion, respectively. Economists will be watching the figure to gauge the strength of cross-border transactions as major economies continue to open as vaccination efforts make progress across the globe.

1 2
View single page >> |

Disclaimer: See the full disclosure for DailyFX here.

How did you like this article? Let us know so we can better customize your reading experience.

Comments

Leave a comment to automatically be entered into our contest to win a free Echo Show.