The New Zealand dollar was mixed today, though it largely did not go far from the opening level against its major rivals. The notable exceptions were the Great Britain pound and the Australian dollar, with the former one demonstrating a decent gain and the latter one showing a decline versus the kiwi.
The BusinessNZ Performance of Manufacturing Index climbed to 54.0 in September from 51.0 in August. While the reading was undoubtedly good, BNZ Senior Economist Doug Steel pointed out that it was not as great as it might look at the first glance:
Although the September PMI pushed above its long-term average of 53.0, it should not be confused with above average activity levels. Rather, it indicates growth off the low base set earlier in the year. Growth has not yet been enough to recoup previous losses, but some progress is being made.
With few economic notable economic releases in New Zealand this week or the next, the New Zealand currency will likely be driven by the upcoming election, the monetary policy outlook, and the general market sentiment. The New Zealand general election will be held tomorrow, and polls show that the Labour Party of the incumbent Prime Minister Jacinda Ardern will win a landslide victory. But analysts speculated that the outlook for negative interest rates and other stimulating measures from the Reserve Bank of New Zealand should have a bigger impact on the kiwi, putting downside pressure on the currency.
NZD/USD was at about 0.6601 as of 10:13 GMT today after opening at 0.6596. GBP/NZD rose from 1.9548 to 1.9594. AUD/NZD fell from 1.0750 to 1.0730.
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