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Euro to New Zealand Dollar Exchange Rate Weaker after Optimistic NZ News
Published: 3 May at 3 PM Tags: Euro Exchange Rate, Dollar Exchange Rate, New Zealand Dollar Exchange Rate, Currency Exchange, Swiss Franc Exchange Rate, Euro Crisis, UK, Exchange Rates, France,
The Euro to New Zealand Dollar exchange rate has been pushed lower this week by a mix of political jitters and a stronger New Zealand Dollar, despite Eurozone data consistently impressing.
EUR/NZD has lost around a cent in value so far this week. After beginning the week at the level of 1.5870 the pair had dropped to a weekly low of 1.5688 on Wednesday morning. EUR/NZD trended in the region of 1.57 during Wednesday’s European session.
Euro (EUR) Edges away from Lows on Solid Eurozone Growth Data
After hitting a low in the morning, the Euro to New Zealand Dollar exchange rate spent much of Wednesday trade recovering slightly, thanks to the day’s solid Eurozone GDP results.
Eurozone Gross Domestic Product (GDP) met expectations in preliminary Q1 2017 figures. Quarter-on-quarter growth came in at 0.5% and yearly growth printed at 1.7%.
What’s more, the previous figures were also revised higher from 0.4% to 0.5% and from 1.7% to 1.8% respectively.
This, as well as the week’s Eurozone employment stats, bolstered economic sentiment for the Eurozone. Eurozone unemployment came in with a solid 9.5% in March while German unemployment came in with a solid 5.8% in April.
However, with the Eurozone’s manufacturing data slightly below expectations and French election jitters persisting, the Euro has been unable to hold against EUR/NZD drops.
With only a few market sessions left before the final round of the French Presidential election, investors are still highly anxious that anti-EU Marine Le Pen still has a chance of winning the election and beginning a ‘Frexit’.
New Zealand Dollar (NZD) Bolstered by Domestic and Commodity News
Despite solid Eurozone growth and employment data, EUR/NZD has been dragged down by a stronger New Zealand Dollar this week.
Tuesday saw the Global Dairy Trade (GDT) hold its first May dairy auction, which saw prices of New Zealand’s most lucrative commodity increase by a solid 3.6%.
Not only was this the biggest gain in dairy prices since November 2016, it also took prices to their best levels since December 2016.
This gave the New Zealand Dollar a boost in late-Tuesday trade, but the risky ‘Kiwi’ saw an even bigger increase in demand during Wednesday’s Asian session following the publication of New Zealand’s Q1 2017 labour report.
New Zealand’s unemployment rate unexpectedly improved from 5.2% to 4.9% in Q1, despite being projected to remain at 5.2%.
This was partially due to an unexpected increase in labour market participation, as well as much better than expected employment change stats of 1.2% quarter-on-quarter and 5.7% year-on-year.
EUR/NZD Forecast: French Election in Focus
Thursday and Friday are the only two remaining trade sessions before the French public votes in an election that could alter the future of the Eurozone as we know it.
It sounds dramatic, but with France being one of the Eurozone’s biggest economies, a ‘Frexit’ has been seen as one of the biggest potential threats to the currency bloc.
Far-right French election candidate Marine Le Pen has made a potential ‘Frexit’ a big part of her campaign. While she trails frontrunner pro-EU Emmanuel Macron by some 15-20 points in opinion polls, investors remain anxious that she could somehow still turn the tables.
After last year’s surprising Brexit and Trump votes, investors have hesitated to buy into the Euro en masse just in case Le Pen still manages to win. In this scenario, the Euro would plummet when markets open next Monday and EUR/NZD would likely lose much of its April gains.
The Euro is likely to become increasingly jittery as the weekend approaches. While the shared currency could be supported slightly on Thursday and Friday if retail data beats expectations, EUR/NZD is unlikely to advance far with the French election right around the corner.
EUR/NZD has lost around a cent in value so far this week. After beginning the week at the level of 1.5870 the pair had dropped to a weekly low of 1.5688 on Wednesday morning. EUR/NZD trended in the region of 1.57 during Wednesday’s European session.
Euro (EUR) Edges away from Lows on Solid Eurozone Growth Data
After hitting a low in the morning, the Euro to New Zealand Dollar exchange rate spent much of Wednesday trade recovering slightly, thanks to the day’s solid Eurozone GDP results.
Eurozone Gross Domestic Product (GDP) met expectations in preliminary Q1 2017 figures. Quarter-on-quarter growth came in at 0.5% and yearly growth printed at 1.7%.
What’s more, the previous figures were also revised higher from 0.4% to 0.5% and from 1.7% to 1.8% respectively.
This, as well as the week’s Eurozone employment stats, bolstered economic sentiment for the Eurozone. Eurozone unemployment came in with a solid 9.5% in March while German unemployment came in with a solid 5.8% in April.
However, with the Eurozone’s manufacturing data slightly below expectations and French election jitters persisting, the Euro has been unable to hold against EUR/NZD drops.
With only a few market sessions left before the final round of the French Presidential election, investors are still highly anxious that anti-EU Marine Le Pen still has a chance of winning the election and beginning a ‘Frexit’.
New Zealand Dollar (NZD) Bolstered by Domestic and Commodity News
Despite solid Eurozone growth and employment data, EUR/NZD has been dragged down by a stronger New Zealand Dollar this week.
Tuesday saw the Global Dairy Trade (GDT) hold its first May dairy auction, which saw prices of New Zealand’s most lucrative commodity increase by a solid 3.6%.
Not only was this the biggest gain in dairy prices since November 2016, it also took prices to their best levels since December 2016.
This gave the New Zealand Dollar a boost in late-Tuesday trade, but the risky ‘Kiwi’ saw an even bigger increase in demand during Wednesday’s Asian session following the publication of New Zealand’s Q1 2017 labour report.
New Zealand’s unemployment rate unexpectedly improved from 5.2% to 4.9% in Q1, despite being projected to remain at 5.2%.
This was partially due to an unexpected increase in labour market participation, as well as much better than expected employment change stats of 1.2% quarter-on-quarter and 5.7% year-on-year.
EUR/NZD Forecast: French Election in Focus
Thursday and Friday are the only two remaining trade sessions before the French public votes in an election that could alter the future of the Eurozone as we know it.
It sounds dramatic, but with France being one of the Eurozone’s biggest economies, a ‘Frexit’ has been seen as one of the biggest potential threats to the currency bloc.
Far-right French election candidate Marine Le Pen has made a potential ‘Frexit’ a big part of her campaign. While she trails frontrunner pro-EU Emmanuel Macron by some 15-20 points in opinion polls, investors remain anxious that she could somehow still turn the tables.
After last year’s surprising Brexit and Trump votes, investors have hesitated to buy into the Euro en masse just in case Le Pen still manages to win. In this scenario, the Euro would plummet when markets open next Monday and EUR/NZD would likely lose much of its April gains.
The Euro is likely to become increasingly jittery as the weekend approaches. While the shared currency could be supported slightly on Thursday and Friday if retail data beats expectations, EUR/NZD is unlikely to advance far with the French election right around the corner.
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Source: moneytransfer.co.uk