NZD/USD keeps marching higher and reaches 0.6900
- The New Zealand dollar reaches 0.6900 in a three-day rally.
- The kiwi extends gains amid a moderate risk appetite and USD weakness.
- NZD/USD aiming towards 0.6925 this week – Westpac.
The New Zealand dollar has surged about 1% against the USD so far on Thursday, to extend its three-day rally from 0.6730 lows to session highs right at 0.6900.
The kiwi appreciates on post-Fed dollar weakness
The US dollar is losing ground across the board, weighed by a pull-back on US bond yields. The Federal Reserve‘s first interest rate hike in more than three years and its plan to gradually normalize monetary policy has failed to provide support to the USD and the US Dollar Index is nearly 0.7% down on the day, testing two-week lows around 97.80.
The NZD has taken advantage of the US dollar's weakness to appreciate further amid a mixed market mood. Investors remain fairly optimistic about the possibility of seeing some progress in the Russia – Ukraine talks and the US equity markets are posting moderate gains after a mixed session in Europe.
Furthermore, the Chinese Government’s pledge to roll out a new economic stimulus program triggered a fresh impulse to the NZD, as China is one of New Zealand’s main trading partners.
NZD/USD aiming towards 0.6925 this week – Westpac
According to FX Analysts at Westpac, the pair might extend towards 0.6925 this week: “NZD/USD retains upward momentum and is poised to test 0.6875 and then 0.6925 during the week ahead (…) While geopolitical risks will restrain the NZD during the weeks ahead, by year-end we target 0.7100+.”
Technical levels to watch
Author
Guillermo Alcala
FXStreet
Graduated in Communication Sciences at the Universidad del Pais Vasco and Universiteit van Amsterdam, Guillermo has been working as financial news editor and copywriter in diverse Forex-related firms, like FXStreet and Kantox.
