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US Dollar Jumps against New Zealand Dollar

Published: 1 Mar at 5 PM Tags: Dollar Exchange Rate, New Zealand Dollar Exchange Rate, Forex,

‘Trump Bump’ In Action as US Dollar Soars against New Zealand Dollar on Market Optimism

The US Dollar has been in high demand today, rising notably against the New Zealand Dollar after strong support came from President Trump and the US Federal Reserve.

In the former case, Trump’s recent address to congress has had a major positive impact on US markets, with trading in the US Dollar increasing considerably due to the levels of faith being placed in the Trump administration.

Although on paper Trump continued to withhold key details about certain policies, in particular what he would be replacing the ‘Obamacare’ health care act with, markets were generally happy to see a more positive and measured address from a President who has previously been infamous for his flashy and divisive delivery.

Other support came from Federal Reserve officials, who again indicated that they could be looking to raise the US interest rate in the near-term. Given the rarity of US rate hikes, this outcome would raise US Dollar demand considerably.

As well as a few more Fed speeches tonight, the US Dollar is also expected to be moved by claims data in the future, which has been forecast to show USD-damaging rises in both continuing and initial claims in late February.

New Zealand Dollar Heavily Devalued by Rising US Dollar, Future Fears

As well as the strong US Dollar pushing down demand for the New Zealand Dollar, the NZD has also been weakened by concerns about the future today.

These issues have revolved around how US trade and foreign policy might have negative impacts on New Zealand economic growth; Reserve Bank of New Zealand (RBNZ) Governor Graeme Wheeler has recently warned that;

‘The greatest source of [NZ economic] uncertainty relates to the US Administration policies in respect to it's 'American First' platform’.

The next piece of notable NZ data isn’t due out until the coming Sunday, when building permits figures are due for release. If they rise out of the previous negative range, then the NZD could recover against the US Dollar.

Further ahead, the coming Tuesday’s Global Dairy Trade price index is sure to trigger notable New Zealand Dollar movement, as a rise will raise optimism about the health New Zealand’s dairy product industry.
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