The New Zealand dollar surged along with other commodity currencies today on the news about a temporary truce in the trade war between the United States and China. The kiwi was unable to beat its Australian counterpart, which emerged as the strongest on the Forex market.
The US and China leaders agreed for a 90-days truce. The countries will not implement additional tariffs against each other and open their markets during the period. While many analysts believe that the ceasefire will not hold, for now markets are rejoicing and are in a risk-on mode.
Meanwhile, data released today showed that manufacturing in China, New Zealand’s biggest trading partner, was stable. The Caixin China Manufacturing PMI was at 50.2 in November, seasonally adjusted, little changed from October’s level. Being very close to the neutral 50.0 level, the indicator showed that the sector barely grew, but it was not declining either.
NZD/USD traded at 0.6928 as of 14:30 GMT today after closing at 0.6881 on Friday and opening at 0.6917 on Monday. EUR/NZD dropped from 1.6405 to 1.6368 after closing at 1.6449 at the previous trading session. AUD/NZD declined from 1.0663 to 1.0648 but was still significantly higher above the Friday’s close of 1.0615.
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