The Australian Dollar New Zealand Dollar (AUD NZD) exchange rate trended higher on Friday following an impressive domestic Manufacturing PMI.
Australian Dollar (AUD) Strengthens as Manufacturing Activity Jumps
The Australian Dollar was able to push higher again at the end of this week’s session as domestic manufacturing activity rose faster than expected last month.
According to figures compiled by Ai Group (AiG) Australia’s manufacturing PMI jumped from 51.1 to 57.3 in November overshooting expectations of a more modest rise to 54 and reaching its highest levels since August.
The index has now shown 14 consecutive months of growth, the longest run of expansion in over a decade.
The latest jump in growth appeared to be largely attributed to a decline in the Australian Dollar over the past couple of month’s which led to increase export demand as the exchange rate became more appealing for foreign buyers.
An accompany note from AiG read;
‘November signalled a stronger pace of growth, after two months of relatively slower growth in September and October coinciding with the final closure of automotive assembly and a slightly higher Australian dollar in Q3.’
However slightly tempering market reaction was the news that only 5 out of 8 sectors expanded last month.
New Zealand Dollar (NZD) Remains Subdued on Business Confidence Data
At the same time the New Zealand Dollar struggled to hold off the Australian Dollar’s advances during the Asian session on Friday as investors continued to shy away from the ‘Kiwi’ in the wake of Thursday’s lacklustre Business confidence figures.
Data from ANZ revealed than domestic Business Confidence nosedived in November, with all major sub-indices excluding construction falling last month as the uncertainty of a new government caused firms to become increasingly dovish.
AUD NZD Forecast: Australia’s Services PMI to Also Show Growth?
Looking ahead to next week the AUD NZD exchange rate may tick higher again in the first half of the session with the release of Australia’s latest Services PMI, with the nation’s services sector also expected to have seen an increase in activity last month.
Meanwhile the most notable data impacting the New Zealand data next week, will be the Global Dairy Auction, with another fall in dairy prices likely to weigh heavily on the ‘Kiwi’.
Current Interbank Exchange Rates
At the time of writing the AUD/NZD exchange rate was trending around 1.1080 and the NZD/AUD exchange rate was trending around 0.9020.