The Australian Dollar to New Zealand Dollar (AUD/NZD) Exchange Rate has advanced by around 0.15% on Thursday. This can be attributed to the Reserve Bank of New Zealand opting to hold their benchmark interest rate thanks to anxieties regarding ‘Kiwi’ (NZD) overvaluation.
Although Australian data has produced mixed results, the ‘Aussie’ (AUD) has strengthened against the majority of its most traded peers as a result of trader dissatisfaction with the Federal Reserve.
The Australian Dollar to New Zealand Dollar exchange rate is currently trending in the region of 1.1259.
Over the past few weeks market sentiment has dramatically improved. This is due to easing geopolitical tensions and less anxiety regarding the slow pace of global economic growth. As risk-correlated, high-yielding currencies, both South Pacific assets have benefitted from the lack of cautious trading.
During the European session, the New Zealand Dollar appreciated as a result of better-than-expected economic data. However, the ‘Kiwi’ gradually softened over the course of the day as traders prepared for the RBNZ rate decision.
The Australian Dollar to New Zealand Dollar exchange rate dropped to a low today of 1.1236.
On Thursday, both the Australian Dollar and the New Zealand Dollar have appreciated as a result of mixed feelings surrounding the Fed rate decision. Although the Fed was seen to act positively by ending a long period of quantitative easing, they were still dovish in regard to rate revisions. By continually using phrases like ‘considerable time’ when describing the timing of a rate hike, traders have lost confidence in the institution.
Speculation that Thursday’s US growth data will produce negative results has also aided a surge for the antipodean currencies.
Australian economic data on Thursday produced mixed results, although this has been received relatively mutely by traders. New Home Sales stagnated on the month in September after climbing by 3.3% in August. The Import Price Index was unable to meet with forecasts, declining by a further -0.8% following the previous month’s -3.0% decline. The Export Price Index came in at -3.9% rather than the -4.7% figure forecast.
The Reserve Bank of New Zealand rate decision is the reason that the New Zealand Dollar is softer against the Australian Dollar. ‘A period of assessment remains appropriate before considering further policy adjustment,’ Reserve Bank of New Zealand Governor Graeme Wheeler said in Wellington after keeping the official cash rate at 3.5 percent.
‘Lower commodity prices and increased global financial market volatility have taken some pressure off the New Zealand Dollar,’ Wheeler said. ‘However, its current level remains unjustified and unsustainable and continues to constrain growth in the tradables sector. We expect a further significant depreciation.’
Australian Dollar to New Zealand Dollar Exchange Rate Forecast to Strengthen
If the US growth figures disappoint, as traders have predicted, both the Australian Dollar and the New Zealand Dollar will appreciate. However the ‘Aussie’ is likely to benefit more from the surge as the ‘Kiwi’ is being held back by comments from the RBNZ.
The Australian Dollar to New Zealand Dollar exchange rate has reached a high today of 1.1280.
Australian Dollar (AUD) Exchange Rates
[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate ,
Australian Dollar,
,US Dollar,0.8792,
Australian Dollar,,Euro,0.6982,
Australian Dollar,,Pound,0.5495,
Australian Dollar,,New Zealand Dollar,1.1264,
US Dollar,,Australian Dollar,1.1374,
Euro,,Australian Dollar,1.4326,
Pound Sterling,,Australian Dollar,1.8197,
New Zealand Dollar,,Australian Dollar,0.8878,
[/table]
