Ella 
NZD/USD strengthens above the 0.6350 area. Market trading was light in the last week of 2023, the US dollar was weak and the market maintained risk appetite, supporting the upward momentum of NZD/USD. As of press time, the New Zealand dollar/US dollar was trading at 0.6360, up 0.34% on the day.
NZD/USD benefited from improving consumer and business confidence in New Zealand. In addition, the hawkish stance of the New Zealand Reserve Bank also provided support for the New Zealand dollar. Analysts at ANZ predict that a return to global risk appetite and the New Zealand dollar’s high carry advantage will drive NZD/USD’s continued upward trajectory in 2024.
Data released on Wednesday showed that the U.S. Richmond Fed manufacturing index fell to -11 in December from the previous value of -5, which was lower than the expected value of -7.
The U.S. is due to release its weekly jobless claims report on Thursday, with an increase of 210,000 expected in the week ending December 23.
The dollar fell to its lowest level since July near 100.85 as a pullback in the core U.S. personal consumption expenditures price index (PCE) in November fueled bets on an early interest rate cut by the Federal Reserve (Fed) in 2024. Investors expect the Fed to keep interest rates on hold at its upcoming January meeting and cut rates as early as March next year.
Looking ahead, market participants will get more clues from Thursday’s release of U.S. initial jobless claims for last week, the trade balance and November existing home sales data. The Chicago Purchasing Managers’ Index for December will be released on Friday. As traders move into holiday 2024 mode, the data may not have a major impact on the market.
