NZ Dollar Rises Amid Risk Appetite
July 30 2024 - 11:23PM
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The New Zealand dollar strengthened against most major
currencies in the Asian session on Wednesday amid risk appetite, as
traders remain optimistic about the outlook for interest rates as
they cautiously await the U.S. Fed's monetary policy announcement
later in the day.
Though the Fed is widely expected to leave interest rates
unchanged, traders will be looking to the accompanying statement
for additional clues about a possible rate cut in September.
According to CME Group's FedWatch Tool, there is currently an
87.7 percent chance the Fed will lower rates by a quarter point in
September and an 11.9 percent chance of a half point rate cut.
In other economic news, the latest survey from the National
Bureau of Statistics showed that the manufacturing sector in China
continued to contract in July, and at a slightly faster rate, with
a manufacturing PMI score of 49.4. That was in line with
expectations and down slightly from 49.5 in June.
Also, data from Statistics New Zealand showed that the total
number of building permits issued in New Zealand in June was down a
seasonally adjusted 13.8 percent on month, after slipping 1.9
percent in May.
In the year ended June 2024, the actual number of new dwellings
consented was 33,627, down 24 percent from the year ended June
2023.
In the Asian trading today, the NZ dollar rose to 6-day highs of
0.5927 against the U.S. dollar and 1.8262 against the euro, from
yesterday's closing quotes of 0.5903 and 1.8318, respectively. If
the kiwi extend its uptrend, it is likely to find resistance around
0.60 against the greenback and 1.80 against the euro.
Against the yen, the kiwi edged up to 90.87 from a recent
6-month low of 89.57. The NZD/JPY pair may test resistance around
the 91.00 region.
Looking ahead, Eurozone flash harmonized inflation data for July
is slated for release in the European session.
In the New York session, U.S. MBA weekly mortgage approvals
data, U.S. ADP Nonfarm employment data for July, Canada GDP data
for May, U.S. pending home sales for June and U.S. EIA crude oil
data are slated for release.
At 2:00 pm ET, the U.S. Federal Reserve will announce its fifth
interest rate decision for 2024 later tonight after a two-day
Federal Open Market Committee (FOMC) meeting today. The central
bank is expected to maintain its benchmark interest rates between
5.25 per cent - 5.50 percent.
Half-an-hour later, U.S. Fed Chairman Powell will conduct a
press conference about the final monetary policy announcement.
Euro vs NZD (FX:EURNZD)
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Euro vs NZD (FX:EURNZD)
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