NZD/USD News and Analysis

nzdusd kiwi

NZD/USD Advances To Fresh 2017 High

NZD/USD rallied for a third consecutive day and is seen scaling above resistance from the February high to print fresh highs for the year....
new zealand parliament

NZD/USD Retreats After Posting A New 2017 High

NZD/USD advanced for a second straight session and is seen attempting to break to new highs for the year. The pair briefly broke...
New Zealand

NZD/USD Reverses Higher To Erase Losses From CPI Miss

A shortfall of expectations in quarterly NZ CPI data led to a sharp push lower in NZD/USD but a broadly weaker US dollar has...
new zealand flag

NZD/USD Continues To Struggle At Resistance From June High, NZ Quarterly CPI Up Next

NZD/USD dropped sharply lower from resistance shortly ahead of the European close, posting a bearish engulfing candle in the process on an hourly chart...

Live NZD/USD Chart


NZD/USD is a currency pair classified as one of the Majors. The New Zealand Dollar is considered a commodity currency and carries the highest yield among the major currencies.

Nicknames

The most common nickname for the New Zealand Dollar is Kiwi. The currency pair is sometimes referred to as the Kiwi, or Kiwi Dollar. The nickname is a commonly given to New Zealand citizens and stems from their national flightless bird.

NZD/USD Correlations

The New Zealand Dollar tends to have correlated movements with other commodity currencies such as the Australian Dollar and Canadian Dollar because of similarities in their economies.

Because New Zealand tends to offer the highest interest rate among the major economies, the currency is often used in carry trades. As these trades gain popularity during periods of increased risk appetite, the NZD/USD will carry positive correlation with other risk-based assets, such as the equity markets. These correlations tend to be strongest when there is clear risk sentiment driving the markets, and are known to diverge often.

What Factors Affect NZD/USD?

Interest rate differentials are a big driver of the NZD/USD exchange rate. During periods of US Dollar weakness, often the currency pair is preferred as it is associated with the largest carry interest. But as New Zealand is export driven, the Reserve Bank of New Zealand (RBNZ) is active in lowering the value of their exchange rate.

When exports decrease, lowering the exchange rate can offset some of the loss in income, and increase demand. The RBNZ can lower the interest rate to maintain a lower exchange rate, and is often involved in ‘jaw-boning’ the currency down, essentially threatening to intervene in an attempt to reduce bullish sentiment in the markets for its currency. Further information in regards the RBNZ can be found at its official site. Further information on the US central bank, the Federal Reserve, can be found at https://www.federalreserve.gov/.

Risk sentiment also influences NZD/USD. During periods of risk appetite, investors seek out the currency for its positive yield, while heavy selling is seen during risk aversion as investors are quick to exit out of the currency pair.

New Zealand’s export industry is driven by dairy products. New Zealand releases a bi-weekly economic release updating their global dairy trade index figures. As exports comprise a large part of their GDP, a decline in exports, or specifically dairy, can impact the economy in a negative manner. Poor performance in the economy can lead to a weaker New Zealand Dollar, or trigger action from the central bank, once again leading to a weaker NZD.

When Does NZD/USD Experience Volatility?

NZD/USD tends to experience its highest volatility during the North American and European overlap, similar to most majors. The pair tends to have fairly steady volatility during other parts of the day as well, as economic releases are scheduled during the Asian session, a time that is usually quiet for the other currency pairs.

Who Trades the NZD/USD?

NZD/USD is commonly traded by investors looking for yield through a carry trade. The higher cost associated with shorting the pair deters traders during extended periods of US Dollar strength. The commission on the currency pair tends to be higher than most majors, if not the highest. For this reason, the pair is less popular among scalpers.

Position traders and intraday traders tend to drive more volume in the pair. The pair is also known to offer volatility during Asian hours, and often as the North American session tends to slow ahead of the Asian open, traders will look to the pair for volatility, especially if there is an economic release on the schedule.

1,963FansLike
9,753FollowersFollow
1,462FollowersFollow

Live Forex Rates

FX PairsBidAsk
Live FOREX Rates by FXCM

Upcoming Economic Events

Other News

US Dollar

DJIA Today: Dow Jones Futures Pare Losses but GE Weighs

The Dow Jones Industrial Average settled off session lows Friday, as disappointing earnings for industrial bellwether General Electric (NYSE: GE) weighed.The blue-chip index dropped...
USA

S&P 500 Futures Flat as Energy, Industrials Lag

U.S. stocks ended the week on a softer note, as shares of energy and industrial companies led the declines.The large-cap S&P 500 Index pared...
natural gas

Slide In Crude Oil Undermines Natural Gas Prices, Positioning In Focus

Natural gas was unable to make any further headway following Thursday’s storage data with an element of profit taking following gains during the week...
crude oil pumpjack

Baker Hughes US Oil Rig Count Declines To 764, 2nd Decline Since Late June

The total Baker Hughes North American rig count for the week ending July 21st declined to 950 from 952 the previous week.The number of...
laboratory

Deutsche Bank Starts Covering TherapeuticsMD (TXMD) With A Buy

TherapeuticsMD Inc (NYSEMKT:TXMD) is making some impressive gains today, following the news that Deutsche Bank initiated coverage on the company’s stock – kicking things...