- The antipodeans were able to recover some ground on dollar weakness.
- NZD/USD holds in the 0.60 handle ahead of CPI data.
NZD/USD traders will be looking to the NZ Consumer Price Index today following a period of range trading into the close last week where the price continues to range-trade around 0.6000. The US dollar was a major contributor to the commodity-FX's downfall last week although as it eased off, the antipodeans were able to recover some ground.
US President Donald Trump’s desire to unlock the US economy helped to boost risk sentiment along with the positive news that surrounded the tests for possible treatments to COVID-19. Equity markets strengthened into the close with the Dow Jones up 3.0% and the S&P500 2.7% higher and commodity-FX responded in kind, with the bird ending the day +1%.
COVID-19 update
Meanwhile, COVID-19 cases continue to climb especially in the US which has now toppled 750,000 cases:
In New Zealand, nine new cases of COVID-19, four confirmed and five probable, were identified in New Zealand on Sunday. The nation's death toll has risen to 12, after confirmation that an Invercargill man who died more than a week ago, was suffering from the virus. However, while the total number of confirmed and probable cases in New Zealand is now at 1431, 912 people have recovered from the virus while more than 4000 tests were processed in laboratories on Saturday.
NZ Q1 CPI preview
Analysts at ANZ Bank expect that the Consumer Price Index lifted 0.5% QoQ, with annual inflation accelerating 0.3% pts to 2.2%. Non-tradable inflation of 1.0% q/q will be just enough to see the annual number hold on to its 3 handle – for now. Tradable inflation is flattered by 2019’s weak Q1 read dropping out of the calculation, but weak petrol prices loom in Q2. In today’s context, what inflation did in Q1 is hardly relevant for monetary policy settings. The RBNZ has already thrown the kitchen sink at it, but even more will be needed. We see RBNZ QE roughly doubling to around NZD60bn."
NZD/USD levels
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 clings to gains above 1.0750 after US data
EUR/USD manages to hold in positive territory above 1.0750 despite retreating from the fresh multi-week high it set above 1.0800 earlier in the day. The US Dollar struggles to find demand following the weaker-than-expected NFP data.
GBP/USD declines below 1.2550 following NFP-inspired upsurge
GBP/USD struggles to preserve its bullish momentum and trades below 1.2550 in the American session. Earlier in the day, the disappointing April jobs report from the US triggered a USD selloff and allowed the pair to reach multi-week highs above 1.2600.
Gold struggles to hold above $2,300 despite falling US yields
Gold stays on the back foot below $2,300 in the American session on Friday. The benchmark 10-year US Treasury bond yield stays in negative territory below 4.6% after weak US data but the improving risk mood doesn't allow XAU/USD to gain traction.
Bitcoin Weekly Forecast: Should you buy BTC here? Premium
Bitcoin (BTC) price shows signs of a potential reversal but lacks confirmation, which has divided the investor community into two – those who are buying the dips and those who are expecting a further correction.
Week ahead – BoE and RBA decisions headline a calm week
Bank of England meets on Thursday, unlikely to signal rate cuts. Reserve Bank of Australia could maintain a higher-for-longer stance. Elsewhere, Bank of Japan releases summary of opinions.