Australian Dollar to New Zealand Dollar Exchange Rate Continues to Rebound from Multi-Month Lows
Despite a lack of supportive Australian ecostats in recent sessions, the Australian Dollar to New Zealand Dollar (GBP/NZD) exchange rate has advanced so far this week as the pair continues to rebound from last week’s low.
Last week, AUD/NZD briefly touched on a low of 1.0655. This was the pair’s lowest level since August 2017 – but as the Australian Dollar (AUD) found levels of major psychological support it has since recovered.
Since AUD/NZD opened at the level of 1.0755 on Monday, the pair has climbed and during Wednesday’s European session the pair hit a weekly high of 1.0824.
More than being supported by domestic Australian news, the Australian Dollar to New Zealand Dollar (AUD/NZD) exchange rate has climbed as investors buy the Australian Dollar back from its recent lows against major currencies.
The Australian Dollar has seen poor performance in February due to market concerns about subdued Australian inflation and wages.
However, as prices of iron ore, Australia’s most lucrative commodity, have been strengthening and Australia’s job market is overall strong too, analysts predict the AUD selloff may have been overdone. This has helped it to recover against the New Zealand Dollar (NZD).
News that Australia’s Treasury boss, John Fraser, was confident that domestic wage growth would begin to improve soon also made the Australian Dollar more appealing.
New Zealand Dollar (NZD) Lacks Momentum Following January Trade Stats
This week’s New Zealand data has been unable to make the New Zealand Dollar more appealing to investors, as much of the data has been negative.
Tuesday saw the publication of New Zealand’s January trade balance results, which revealed that the trade figure of N$596m had slipped to a deficit of N$-566m.
While the results were actually better than the expected figure of N$-2710m, it was still the worst January trade deficit since 2007. Markets were also disappointed that imports came in with a worse than expected N$4.87b.
Wednesday followed with New Zealand business confidence, which improved slightly from -37.8 to -19. January visitor arrivals worsened though, from 3.9% to -0.5%.
Australian Dollar to New Zealand Dollar (AUD/NZD) Forecast: Australian Manufacturing Ahead
If upcoming Australian ecostats impress investors, the Australian Dollar to New Zealand Dollar (AUD/NZD) exchange rate could extend its recent recovery rally.
Thursday’s Asian session will see the publication of Australia’s manufacturing PMI from AiG. The previous figure came in with a strong 58.7.
HIA’s December new home sales results and Q4 private capital expenditure data will be published too, followed by some new home sales stats for January on Friday.
Trade data will remain in focus for New Zealand Dollar traders for the remainder of the week. On Thursday, New Zealand terms of trade data from Q4 will be published.
Friday’s ANZ consumer confidence data for February and January’s building permits figures could also inspire New Zealand Dollar movement towards the end of the week.