We saw added volatility in the New Zealand (NZD), Euro (EUR) cross this week with economic data raising eyebrows. Monday’s NZ CPI read pushed higher to 7.3% up from 6.9% in the first quarter and above the forecasted 7.1% predicted. The news took the pair to 0.6065 (1.6490) from the weekly open around the 0.6120 (1.6340) area. The ECB raised their cash rate 50 points overnight lifting the rate to zero. The first time they have raised rates in 11 years. Consumers will no longer be paying banks to store their funds. The ECB unveiled a plan to buy debt of Europe’s most valuable economies as it takes aggressive action to bring down skyrocketing inflation and slowing economic growth. Post the release the kiwi made back earlier losses trading to 0.6120 (1.6350) into Friday morning. French and German Manufacturing data will close out the week tonight and is forecast to disappoint. Downside risks for the kiwi remain.
The current interbank midrate is: NZDEUR 0.6113 EURNZD 1.6358
The interbank range this week has been: NZDEUR 0.6044- 0.6157 EURNZD 1.6240- 1.6544