Mixed performance from the New Zealand dollar, starting off strong right from the week open before the Reserve Bank of New Zealand came along to knock down NZD bulls.
Global risk sentiment was a factor in the Kiwi’s performance as well, putting pressure at the end of the week as coronavirus fears rose.
New Zealand Headlines and Economic data
RBNZ keeps interest rates and asset purchases unchanged as expected – traders sold the Kiwi on the event, likely on a some profit taking given the relative strength in the Kiwi ahead of the statement, but possibly on comments from the RBNZ on how the rise in NZD’s value may hurt their export economy.
During the U.S. session, it’s likely that pressure came on the Kiwi as traders ran for safety on a news flow of rising covid cases, negative global economic outlook, and geopolitical tensions (U.S. is considering $3.1 billion in new tariffs on products from France, Germany, Spain and the UK) came out through the day.
Price action in the Kiwi was mixed but net higher against the majors, likely on the rise in broad risk sentiment when an easing of U.S. financial regulations were announced during the U.S. session (Bank stocks reverse higher as regulators ease Volcker Rule).
There were no major catalysts from New Zealand during the Friday session, but we saw a broad move lower in the Kiwi during the U.S. trading session. This was probably on the continued focus and fears of rising coronavirus cases and U.S. states moving back into lockdown mode.