With a near empty calendar from New Zealand, global risk sentiment and counter currency strength were likely the main drivers of the Kiwi once again. Overall, the New Zealand closed out the week as a net loser, only gaining against the Aussie and Sterling at the close on Friday.
New Zealand Headlines and Economic data
- Massive risk-off sentiment right the start of the week after Saudi Arabia stuns the world with massive oil discounts in all-out price war. This was likely catalyst for traders to move quickly out of risk assets right at the open, and a very big spike lower in the Kiwi against the majors, with exception to the Aussie and British pound.
- In the quarter ending in December 2019, the volume of total manufacturing sales rose 2.7%; the value of total manufacturing sales rose 2.4%
- RBNZ’s Orr: No need to use alternative monetary policy at this time
- Global risk aversion sentiment picked up early in the Asian session to send the Kiwi broadly lower on what was perceived to be a weak coronavirus response from the U.S. (travel restrictions from Europe), and possibly picked up speed on the likelihood traders were disappointed that the ECB didn’t do more to stimulate the economy (i.e., no expected rate cut) in their latest monetary policy actions.
- New Zealand food prices were little changed in February
- Business NZ manufacturing index up from 49.8 to 53.2
- After an early U.S. session bump higher in Kiwi (Stimulus hopes bolster Wall Street after worst session since 1987), NZD bears took control once again going into the weekend, likely on broad U.S. dollar strength (demand for dollars growing on U.S. government stimulus actions and on safe haven flows).