- NZD/USD prints two-day winning streak as US regulators tame financial market risks.
- NZIER anticipates much weakness growth in 2024, Thursday’s New Zealand Q4 GDP eyed.
- Easing fears from SVB, Signature Bank renew market’s risk-on mood.
- Mixed US employment data, anxiety ahead of key data/events probe Kiwi pair buyers.
NZD/USD defends Friday’s recovery around 0.6150-55 as market sentiment improves on early Monday. In doing so, the Kiwi pair pays little attention to the downbeat report from the New Zealand Institute of Economic Research (NZIER).
“The latest NZIER Consensus Forecasts show an upward revision to the near-term growth outlook for the New Zealand economy but a downward revision for the subsequent two years,” per the March 2023 NZIER report. The think-tank also adds that annual average GDP growth is forecast to slow to 0.3 percent for the year to March 2024 before picking up to 1 percent in the following year.
The NZD/USD pair’s upside could also be linked to the pacific nation’s Business NZ PSI for February, 55.5 versus 54.5 prior, as well as Food Price Index for the said month, 1.5% MoM compared to 0.6% market consensus and 1.7% previous readings.
Elsewhere, the risk profile benefits from the US regulators’ efforts to tame the financial market risks emanating from the Silicon Valley Bank (SVB) and Signature Bank. That said, US Treasury Department, Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) took joint actions to tame the risks emanating from the SVB and Signature Bank during the weekend. “All depositors of Silicon Valley Bank and Signature Bank will be fully protected,” said the authorities in a joint statement released a few minutes back.
While portraying the mood, the US 10-year Treasury bond yields pare the biggest daily loss in four months near 3.75% while the S&P 500 Futures also rebound from a nine-week low.
It should be noted that the fears emanating from the SVB and Signature Bank drowned the US Treasury bond yields and the US Dollar the previous day, which in turn allowed the NZD/USD to remain firmer despite the risk-off mood.
The US Dollar, on the other hand, failed to cheer the mostly upbeat employment report for February, amid downbeat yields. That said, the US Nonfarm Payrolls (NFP) grew more than 205K expected to 311K in February, versus 504K (revised), while the Unemployment Rate rose to 3.6% for the said month compared to 3.4% expected and prior. Further, the Average Hourly Earnings rose on YoY but eased on monthly basis for February whereas the Labor Force Participation increased during the stated month.
Looking ahead, US Consumer Price Index (CPI) for February, up for publishing on Tuesday, will be crucial for the NZD/USD pair traders ahead of Thursday’s New Zealand fourth quarter (Q4) Gross Domestic Product (GDP).
Technical analysis
NZD/USD recovery remains elusive unless crossing a one-month-old descending resistance line, around 0.6190 by the press time.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds above 1.0700 ahead of key US data
EUR/USD trades in a tight range above 1.0700 in the early European session on Friday. The US Dollar struggles to gather strength ahead of key PCE Price Index data, the Fed's preferred gauge of inflation, and helps the pair hold its ground.
USD/JPY stays above 156.00 after BoJ Governor Ueda's comments
USD/JPY holds above 156.00 after surging above this level with the initial reaction to the Bank of Japan's decision to leave the policy settings unchanged. BoJ Governor said weak Yen was not impacting prices but added that they will watch FX developments closely.
Gold price oscillates in a range as the focus remains glued to the US PCE Price Index
Gold price struggles to attract any meaningful buyers amid the emergence of fresh USD buying. Bets that the Fed will keep rates higher for longer amid sticky inflation help revive the USD demand.
Sei Price Prediction: SEI is in the zone of interest after a 10% leap
Sei price has been in recovery mode for almost ten days now, following a fall of almost 65% beginning in mid-March. While the SEI bulls continue to show strength, the uptrend could prove premature as massive bearish sentiment hovers above the altcoin’s price.
US core PCE inflation set to signal firm price pressures as markets delay Federal Reserve rate cut bets
The core PCE Price Index, which excludes volatile food and energy prices, is seen as the more influential measure of inflation in terms of Fed positioning. The index is forecast to rise 0.3% on a monthly basis in March, matching February’s increase.