Risk sentiment improved Monday with the New Zealand Dollar (NZD) pushing to 0.6360 levels against the US Dollar (USD) before falling back this morning to 0.6330 after selling took place. Equity markets were buoyant recovering from last week’s drops but closed the day flat as the US broke for the Juneteenth holiday. Moves to the topside for the kiwi remain limited fundamentally – on the chart we see resistance at 0.6380 the 50% fib area stemming from the recent low at 0.6200 and 0.6550. It’s now predicted that the US economy will encounter a recession over the next 12 months which could spill over onto the UK and Eurozone and other countries. The cost-of-living crisis and the scary effects from rising inflation causing soaring energy costs will almost make things worse over the coming months. It’s certainly a race to the recession start line, remembering the NZ economy already clocked negative growth in the first quarter of 2022. Key data comes in the form of US Manufacturing later in the week. Buyers of the big dollar should consider the recent rise in the cross above 0.6300.
Current Level: 0.6331
Last Weeks Range: 0.6192-0.6395