Ella 
NZD/USD fell first and then rose on Thursday, trading around 0.6340 during the Asian session on Friday. The New Zealand dollar was boosted by the prospect that the Reserve Bank of New Zealand might delay its easing policy. The consumer confidence index and business confidence index data released in November both improved, which further enhanced the market’s bullish sentiment towards NZD/USD.
New Zealand’s third-quarter gross domestic product (GDP) data showed a contraction, indicating that the Reserve Bank of New Zealand’s interest rate hikes had an impact on the New Zealand economy. New Zealand Reserve Bank Governor Adrian Orr maintained a cautious approach and view of future challenges, especially in dealing with high inflation, highlighting the Bank’s complexity in using monetary policy to guide the economic situation. In addition, ANZ analysts predict that a return to global risk appetite, coupled with the New Zealand dollar’s interest rate differential advantage, will drive NZD/USD upward momentum in 2024.
USD/NZD faces challenges as weak U.S. economic data raises the prospect of a more accommodative stance in the Federal Reserve’s monetary policy decision in early 2024.
U.S. initial jobless claims unexpectedly came in higher than expected at 218,000 for the week ended December 23, exceeding expectations by 210,000, which could cause the dollar to face some headwinds. Additionally, the monthly rate of existing homes for sale was flat at 0.0% in November, missing expectations of 1.0%.
The Chicago Purchasing Managers Index (PMI) for December is due out this Friday. This will further deepen investors’ understanding of the economic conditions in the Chicago area and provide valuable signals for the broader assessment of the U.S. economy. With no major data releases for the New Zealand dollar next week, focus will be on China’s Caixin Manufacturing Purchasing Managers’ Index due out on Tuesday, as investors recognize the importance of China and New Zealand’s close trading partnership.
