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Kiwi bulls have a net positive week, and with no major bullish catalysts from New Zealand, it’s likely the positive vibes came from positive broad risk sentiment and counter currency flows.

Overlay of NZD Pairs: 1-Hour Forex Chart
Overlay of NZD Pairs: 1-Hour Forex Chart
NZD Weekly Performance from MarketMilk
NZD Weekly Performance from MarketMilk

New Zealand Headlines and Economic data


New Zealand building consents was up 3.5% y/y in Sept.


With no major news or economic updates from New Zealand, the net positive move higher against the majors was likely driven by positive risk sentiment. Traders were leaning into risk on the session, potentially sparked by positive stimulus news from the U.K. during the London trading session (UK FCA to announce further proposals to support consumer credit borrowers impacted by coronavirus). This may have been a contributor to the Aussie’s gains as well.


New Zealand unemployment rate rises as recession hits hiring

Given that the employment data came just after the U.S. session close, the rise in volatility later in the Asia session was more likely a part of the broad risk sentiment moves, sparked by U.S. headlines as the votes were starting to be counted for the U.S. Presidential and Congressional elections. Risk sentiment moved back and forth the flow as traders bounced back between fears of a long wait before we get the results, and false claims by Trump of winning the Presidential bid.


NZ ANZ business outlook little changed from October

With no major catalysts from New Zealand, the move higher in the Kiwi was likely influenced by broad risk sentiment as it flipped positive during the London session. This sentiment was likely on traders getting more confident that a Biden win could bring about a massive stimulus program and less regulatory risk in the U.S.


RBNZ expects inflation to rise 1.23% one year out – an improvement from the Sept. 2020 forecast of 1.03% and June reading of 0.74%