AUD NZD Exchange Rate Update: Major Australian Dollar Gains Triggered by ANZ Confidence Jump
The Australian Dollar New Zealand Dollar has gained strongly over today’s trading session, thanks to an unexpected surge in Australian confidence at the start of 2017.
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New Zealand’s economic woes have mainly come from overseas, where a surprising dip in Chinese inflation has raised concerns about future demand for imports from New Zealand.
Pair of Data Deviations Cement Australian Dollar New Zealand Dollar Exchange Rate Strength
Fortune has favoured the AUD NZD exchange rate today, with the Australian Dollar rising by 0.4% to 1.05 against its antipodean rival.
Australia’s latest dose of good news has been Tuesday morning’s ANZ Roy Morgan weekly consumer confidence index, which has risen substantially from 113.4 to 120.1.
Discounting the chances of seasonal bias, ANZ Senior Economist Jo Masters said;
‘While consumers tend to be more optimistic in January, likely due to the holiday season, it is a positive sign for the economy that households are particularly upbeat about their current financial situation’.
Meanwhile, the latest news to weigh on the outlook for the New Zealand economy has come from China.
Annual inflation in December has dropped from 2.3% to 2.1% against forecasts.
This comes at a time when China is aiming to cut coal and steel production, in an effort to transition the economy away from mass manufacturing towards services-based growth. Chinese officials announced that they intend to continue cutting industrial capacity to try and limit the activity of the sector.
These factors have raised the legitimate concern among New Zealand’s exporters that demand from China might take a hit; something that would weaken New Zealand’s overall economy.
Australian Dollar New Zealand Dollar Exchange Rate Outlook: Further Australian Confidence Stats Incoming
The next Australian economic news to watch out for is due this morning, consisting of Westpac’s consumer confidence change for January.
Investors will be hoping for a rise, given that December’s figure was a drop of -3.9%.
New Zealand Dollar Predicted to Worsen if Chinese Imports Fall This Week
As well as having little domestic data to speak of until next week, New Zealand’s economic prospects also look dim due to forecasts for Chinese imports on Friday.
At the time of writing, it was expected that annual imports in December would drop from 6.7% to 2.7%, further putting pressure on the trade link between New Zealand and China.
Recent Interbank Exchange Rates
At the time of writing, the Australian Dollar New Zealand Dollar (AUD NZD) exchange rate was trending in the region of 1.05 and the New Zealand Dollar Australian Dollar (NZD AUD) exchange rate was trending in the region of 0.95.