Investing.com – Last week saw the New Zealand dollar trade close to a five-week low against its U.S. counterpart mid-week, before rebounding to end the week higher after the European Central Bank announced measures to boost dollar liquidity.
NZD/USD hit 0.8119 on Thursday, the lowest since September 12; the pair subsequently consolidated at 0.8287 by close of trade on Friday, climbing 0.95% over the week.
The pair was likely to find short-term support at 0.8119, Thursday’s low and resistance at 0.8381, the high of September 8.
The kiwi traded close to a five-week low on Thursday after the Reserve Bank of New Zealand kept its benchmark interest rate unchanged and indicated that rates may remain on hold in the coming months.
Speaking after the RBNZ decision, central bank Governor Alan Bollard said there was now greater risk that global economic activity could slow “sharply,” adding that he wanted to be sure that this will not occur before looking at a rate increase.
The kiwi rebounded after the European Central Bank announced that it would provide additional dollar liquidity to euro area lenders in a move coordinated with the Federal Reserve and other major central banks.
The U.S. dollar came under further pressure after government data showed that U.S. retail sales were unchanged in August, following a smaller-than-expected 0.3% gain in July, while a separate report showed that U.S. jobless claims rose more-than-expected.
Other reports showed that U.S. consumer prices rose slightly more than expected last month while manufacturing activity in New York and Philadelphia contracted in September.
The kiwi rose to a one-week high on Friday, before pulling back after a meeting of European Union finance ministers in Poland failed to produce an agreement on how to resolve the region’s debt woes.
Fears over a possible Greek debt default also weighed on sentiment as EU ministers postponed a decision to release the next tranche of aid to the debt-laden country until next month.
In the coming week, investors will be watching the outcome of the Federal Reserve’s extended policy setting meeting on Wednesday for any signs that the bank is looking at providing fresh monetary stimulus to support the economy, while developments in the euro zone also look likely to remain in focus.
Meanwhile, New Zealand is to release official data on second quarter gross domestic product.
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 Friday, as there are no relevant events on the day.
Monday, September 19
New Zealand is to publish a report on consumer sentiment, which is closely correlated to consumer spending.
Tuesday, September 20
The U.S. is to publish government data on building permits, an excellent gauge of future construction activity, as well as a report on housing starts, a leading indicator of economic health.
Wednesday, September 21
New Zealand is to publish data on the country’s current account, as well as reports on credit card spending and visitor arrivals.
Later in the day, the U.S. is to publish industry data on existing home sales as well as a government report on crude oil inventories, which can be a big market mover for the loonie, due to the size of Canada’s energy sector.
In addition, the Federal Reserve is to announce the federal funds rate. The bank's rate statement will be closely watched by investors for any clues to the future direction of monetary policy.
Thursday, September 22
New Zealand is to publish official data on second quarter gross domestic product, the broadest measure of economic activity and the primary gauge of the economy’s health.
In addition, the U.S. is to publish its weekly report in initial jobless claims.
NZD/USD hit 0.8119 on Thursday, the lowest since September 12; the pair subsequently consolidated at 0.8287 by close of trade on Friday, climbing 0.95% over the week.
The pair was likely to find short-term support at 0.8119, Thursday’s low and resistance at 0.8381, the high of September 8.
The kiwi traded close to a five-week low on Thursday after the Reserve Bank of New Zealand kept its benchmark interest rate unchanged and indicated that rates may remain on hold in the coming months.
Speaking after the RBNZ decision, central bank Governor Alan Bollard said there was now greater risk that global economic activity could slow “sharply,” adding that he wanted to be sure that this will not occur before looking at a rate increase.
The kiwi rebounded after the European Central Bank announced that it would provide additional dollar liquidity to euro area lenders in a move coordinated with the Federal Reserve and other major central banks.
The U.S. dollar came under further pressure after government data showed that U.S. retail sales were unchanged in August, following a smaller-than-expected 0.3% gain in July, while a separate report showed that U.S. jobless claims rose more-than-expected.
Other reports showed that U.S. consumer prices rose slightly more than expected last month while manufacturing activity in New York and Philadelphia contracted in September.
The kiwi rose to a one-week high on Friday, before pulling back after a meeting of European Union finance ministers in Poland failed to produce an agreement on how to resolve the region’s debt woes.
Fears over a possible Greek debt default also weighed on sentiment as EU ministers postponed a decision to release the next tranche of aid to the debt-laden country until next month.
In the coming week, investors will be watching the outcome of the Federal Reserve’s extended policy setting meeting on Wednesday for any signs that the bank is looking at providing fresh monetary stimulus to support the economy, while developments in the euro zone also look likely to remain in focus.
Meanwhile, New Zealand is to release official data on second quarter gross domestic product.
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 Friday, as there are no relevant events on the day.
Monday, September 19
New Zealand is to publish a report on consumer sentiment, which is closely correlated to consumer spending.
Tuesday, September 20
The U.S. is to publish government data on building permits, an excellent gauge of future construction activity, as well as a report on housing starts, a leading indicator of economic health.
Wednesday, September 21
New Zealand is to publish data on the country’s current account, as well as reports on credit card spending and visitor arrivals.
Later in the day, the U.S. is to publish industry data on existing home sales as well as a government report on crude oil inventories, which can be a big market mover for the loonie, due to the size of Canada’s energy sector.
In addition, the Federal Reserve is to announce the federal funds rate. The bank's rate statement will be closely watched by investors for any clues to the future direction of monetary policy.
Thursday, September 22
New Zealand is to publish official data on second quarter gross domestic product, the broadest measure of economic activity and the primary gauge of the economy’s health.
In addition, the U.S. is to publish its weekly report in initial jobless claims.