Investing.com – Last week saw New Zealand’s dollar close a 15-month high against its U.S. counterpart amid growing expectations of an interest rate hike by New Zealand’s central bank and as uncertainty over easing continued to weigh on the U.S. dollar.
NZD/USD hit 0.7404 on Wednesday, the pair’s lowest since October 5; the pair subsequently consolidated at 0.7660 by close of trade on Friday, jumping 2.18% over the week.
On Wednesday, the Reserve Bank of New Zealand kept its official cash rate unchanged at 3.0% for the second consecutive month, in line with expectations.
Following the announcement the bank’s governor Alan Bollard said, "While it is appropriate to keep the Official Cash Rate on hold today, it remains likely that further removal of monetary policy support will be required at some stage".
The bank said strong growth in China, Australia and emerging Asian markets would help offset the weak global economy, adding that high export prices and the reconstruction in Canterbury, which was hit by a major earthquake last month, would also support activity.
Meanwhile, official data released Friday seemed to underline expectations that the Federal Reserve will intervene to support the U.S. economic recovery.
U.S. GDP rose at an annual rate of 2.0% in the third quarter, in line with expectations, after rising 1.7% in the second quarter. However the real final sales component - the measure of demand in the U.S. - rose by only 0.6%. That was down from 0.9% in the second quarter and 1.1% in the first quarter.
Next week’s economic calendar contains events capable of shaping currency markets for several weeks to come, with the Fed's November 2-3 FOMC meeting and U.S. nonfarm payrolls. In addition, the U.S. is to release key weekly data on initial jobless claims as well as data on pending home sales and reports on manufacturing and service sector growth.
Meanwhile, New Zealand is to produce key data on inflation and unemployment.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Tuesday as there are no relevant events on this day.
Monday, November 1
The U.S. will begin the week by publishing official data on personal income as well as data on personal spending, which accounts for the majority of overall economic activity. The country is also to publish industry data on manufacturing, a leading indicator of economic health.
Meanwhile, New Zealand is to publish data on its commodity price index. Later in the day, the country is to publish official data on labor costs, a leading indicator of consumer inflation.
Wednesday, November 3
The U.S. is to publish a key monthly report on ADP non-farm employment change, which leads government data by two days. The country is also to publish industry data on service sector growth. In addition, the Federal Reserve is to announce its benchmark interest rate. The announcement will be followed by the heavily anticipated FOMC rate statement.
Later in the day, New Zealand is to publish key quarterly data on employment change and the country’s unemployment rate, a leading indicator of overall economic health.
Thursday, November 4
The U.S. is to publish key weekly data on initial jobless claims, the nation’s earliest economic data and a leading indicator of overall economic health. The country is also to publish quarterly data on non-farm productivity and labor costs, both leading inflationary indicators.
Friday, November 5
The U.S. is to round up the week with data on non-farm employment change and a report on the country's unemployment rate. The country will also release official data on pending home sales, while Federal Reserve Chairman Ben Bernanke is due to deliver a speech at a public engagement. His comments will be closely scrutinized for any clues to the future direction of monetary policy.
NZD/USD hit 0.7404 on Wednesday, the pair’s lowest since October 5; the pair subsequently consolidated at 0.7660 by close of trade on Friday, jumping 2.18% over the week.
On Wednesday, the Reserve Bank of New Zealand kept its official cash rate unchanged at 3.0% for the second consecutive month, in line with expectations.
Following the announcement the bank’s governor Alan Bollard said, "While it is appropriate to keep the Official Cash Rate on hold today, it remains likely that further removal of monetary policy support will be required at some stage".
The bank said strong growth in China, Australia and emerging Asian markets would help offset the weak global economy, adding that high export prices and the reconstruction in Canterbury, which was hit by a major earthquake last month, would also support activity.
Meanwhile, official data released Friday seemed to underline expectations that the Federal Reserve will intervene to support the U.S. economic recovery.
U.S. GDP rose at an annual rate of 2.0% in the third quarter, in line with expectations, after rising 1.7% in the second quarter. However the real final sales component - the measure of demand in the U.S. - rose by only 0.6%. That was down from 0.9% in the second quarter and 1.1% in the first quarter.
Next week’s economic calendar contains events capable of shaping currency markets for several weeks to come, with the Fed's November 2-3 FOMC meeting and U.S. nonfarm payrolls. In addition, the U.S. is to release key weekly data on initial jobless claims as well as data on pending home sales and reports on manufacturing and service sector growth.
Meanwhile, New Zealand is to produce key data on inflation and unemployment.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Tuesday as there are no relevant events on this day.
Monday, November 1
The U.S. will begin the week by publishing official data on personal income as well as data on personal spending, which accounts for the majority of overall economic activity. The country is also to publish industry data on manufacturing, a leading indicator of economic health.
Meanwhile, New Zealand is to publish data on its commodity price index. Later in the day, the country is to publish official data on labor costs, a leading indicator of consumer inflation.
Wednesday, November 3
The U.S. is to publish a key monthly report on ADP non-farm employment change, which leads government data by two days. The country is also to publish industry data on service sector growth. In addition, the Federal Reserve is to announce its benchmark interest rate. The announcement will be followed by the heavily anticipated FOMC rate statement.
Later in the day, New Zealand is to publish key quarterly data on employment change and the country’s unemployment rate, a leading indicator of overall economic health.
Thursday, November 4
The U.S. is to publish key weekly data on initial jobless claims, the nation’s earliest economic data and a leading indicator of overall economic health. The country is also to publish quarterly data on non-farm productivity and labor costs, both leading inflationary indicators.
Friday, November 5
The U.S. is to round up the week with data on non-farm employment change and a report on the country's unemployment rate. The country will also release official data on pending home sales, while Federal Reserve Chairman Ben Bernanke is due to deliver a speech at a public engagement. His comments will be closely scrutinized for any clues to the future direction of monetary policy.