The Kiwi marked its second losing week last week. Think we’ll see a rebound over the next couple of days?
Here are the potential catalysts:
Business NZ manufacturing index (Sept 13, 10:30 pm GMT)
New Zealand won’t be printing major economic releases this week, so it’s likely that traders will pay more attention to this business survey.
The report came in at 51.2 for the month of July against June’s 52.7 reading. BNZ reported that the downtrend could be hinting at “outright slow growth” and not just a slowdown, though it also qualified that July’s result only “produced a few red flags.”
Did the downtrend extend for another month in August? Watch out for the report’s release!
Overall risk appetite
As you can see below, the Kiwi is one of the bears’ favorites when pricing in risk aversion in the markets.
This week pay close attention to the U.S. and its trade negotiations with key partners such as Canada and China. Heck, throw in Japan into the mix in case last week’s rumors have gain traction!
Any cause for uncertainty will likely drag the Kiwi lower, so y’all be on your toes for related headlines that might affect the Kiwi!
Last Week’s Price Review
The Kiwi will soon be marking its second week of net losses since the Kiwi is currently in second-to-last place (as of 7:00 am GMT).
The Kiwi can simply be described as a poor victim of the risk-off vibes this week, as well as the Greenback’s show of strength during the first half of the week.
In fact, the Kiwi suffered the bulk of its losses on Tuesday, which is when demand for the Greenback was really strong, thanks to fears that the U.S. may escalate the ongoing trade with China war by slapping tariffs on $200 billion worth of Chinese goods, as well as growing concerns that emerging economies (that are usually export-oriented) may get caught in the crossfire.
The Kiwi would eventually get a chance to lick its wounds on most pairs when the Greenback took a step back and signs of risk-taking returned during Wednesday’s London session.
Sadly for the Kiwi, most NZD pairs weren’t able to move higher past last week’s closing prices (dashed horizontal line) since the Kiwi apparently moved in sympathy with the Aussie when ANZ and CBA announced that they will also hike rates on variable home loans.