The New Zealand dollar was trading either flat or slightly higher against other currencies, including its commodity-related counterparts. The kiwi got a boost from positive macroeconomic data released in both China, New Zealand’s biggest trading partner, and New Zealand itself. The optimistic market sentiment was helping the currency too.
The ANZ business confidence stood at — 66.6 at the end of April, up from -73.1 in the preliminary report released in the first half of the month. The report commented on the result:
The full-month April ANZ Business Outlook Survey was, while still dire, a slight improvement on the preliminary early-April results. A glimmer of light at the end of the tunnel emerged over the month, with the country making solid progress in its COVID-19 battle. But there was also a technical element to the lift: given the questions are typically whether things will go up, down or sideways, for the roughly one third of the economy that couldnât operate at all under Level 4 lockdown, âdownâ wasnât an option, for activity levels at least.
China’s official manufacturing Purchasing Managers’ Index fell to 50.8 in April from 52.0 in the previous month, missing expectations of 51.0 slightly. Nevertheless, markets were relieved to see that the index remained above the neutral 50.0 level, indicating the second month of expansion in the industry after the huge slump caused by the coronavirus pandemic and measures to contain it. The non-manufacturing PMI climbed to 53.2 this month from 52.3 in the preceding month.
Private data was not as good: the Caixin China Manufacturing PMI fell from 50.1 in March to 49.4 in April, indicating that the industry slipped back into contraction after the short-lived recovery. The report explained the negative result:
After broadly stabilising in March, operating conditions across China’s manufacturing sector weakened slightly in April. The recent easing of measures to halt the spread of the coronavirus disease 2019 (COVID-19) pandemic underpinned a further rise in output. However, the impact of the virus globally led to a substantial drop in export sales, which drove a further decline in total new work.
NZD/USD was about flat at 0.6130 as of 7:21 GMT today. EUR/NZD was down from 1.7718 to 1.7660 intraday but has rebounded to 1.7734 by now. AUD/NZD traded at 1.0678 after opening at 1.0687 and falling to the session low of 1.0670.
If you have any questions, comments, or opinions regarding the New Zealand Dollar, feel free to post them using the commentary form below.