The New Zealand dollar has posted sharp losses in the Monday session. In North American trade, NZD/USD is trading at 0.6615, down 0.74% on the day. In New Zealand, ANZ Commodity Prices slowed to 0.0% in May. In the U.S., unemployment claims rose to 218 thousand, above the estimate of 215 thousand. On Friday, the U.S. releases nonfarm payrolls and wage growth.

The New Zealand dollar enjoyed a banner week, climbing 1.97% last week. This was its strongest weekly gain since mid-November. The kiwi took advantage of a weak U.S. dollar, as investors stayed away after the Federal Reserve hinted that a rate cut could be in the works later this year. The Fed has sounded neutral about its next rate move, but last week’s comments from Powell and FOMC member James Bullard were clear hints that the Fed is leaning to a rate cut. The CME Group has set the odds of a quarter-point cut in July at 67%, as the likelihood a rate cut later this year is growing.

NZD/USD posted strong gains on Friday, after the U.S. posted a very soft nonfarm payrolls report. This was the second dismal release in the past four months. In May, the economy created only 75 thousand jobs, down from 263 thousand a month earlier. Wage growth was unchanged at 0.2%, shy of the estimate of 0.3%. Despite these soft job numbers, the U.S. labor market is in strong shape, and the greenback could quickly bounce back.

- advertisement -


Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.