NZ dollar hits new three-month high as US employment misses expectations
The strong NZ dollar reflects a typical seasonal move during the holidays, ANZ says.
The New Zealand dollar touched a new three-month high as US employment figures fell short of expectations on Friday, while commodity-sensitive currencies such as the kiwi remain in vogue at the start of 2018.
The local currency rose as high as 71.86 US cents and traded at 71.63 cents as at 8am in Wellington from 71.67 cents on Friday in New York. The trade-weighted index was little changed at 74.42 from 74.44 last week.
US non-farm payrolls on Friday showed the world's biggest economy added 148,000 jobs in December, missing expectations, while the unemployment rate was steady at 4.1 percent. The data had little lasting effect on investor sentiment, with US 10-year Treasuries rising 3 basis points to 2.48 percent, while stocks on Wall Street pushed to new highs. That upbeat risk appetite has stoked demand for commodity-linked currencies including the kiwi, Australian and Canadian dollars.
"The NZD has started the New Year on the front foot, rising around 2 percent against the USD since 22nd December and is knocking on the door of 72 cents - a three month high," ANZ Bank New Zealand senior economist Philip Borkin said in a note. "While in some ways this strength reflects a typical seasonal move through the liquidity-thin holiday period, it is not inconsistent with the rally in other risk assets over the past couple of weeks, global equities especially."
Borkin said the kiwi has support at 70.50 US cents and is facing resistance at 72.30 cents, but has an upward bias over the near term due to strong investor appetite for risk, short market positions, few pieces of upcoming economic data, and a weak greenback.
The local currency was unchanged at 81 yen and 4.6470 Chinese yuan, and dipped to 91.07 Australian cents from 91.21 cents on Friday in New York. It traded at 59.58 euro cents from 59.55 cents last week and was little changed at 52.82 British pence from 52.78 pence.
(BusinessDesk)
Paul McBeth
Mon, 08 Jan 2018
Mon, 08 Jan 2018
© All content copyright NBR. Do not reproduce in any form without permission, even if you have a paid subscription.
NZ dollar hits new three-month high as US employment misses expectations
72728