The AUD movement against the NZD started after some dismal data out from the New Zealand economy. This was in the form of the unemployment figure that came out below expectations early last week. The AUD found about half a percents worth of strength off the back of this data. Next was the unemployment figure from Australia, this came out in a positive note. For the third consecutive month the Australian unemployment figure came out above expectations, this one almost doubling the expected figure. The market continued this trend of AUD strength for the rest of the week.
Yesterday, NAB Business confidence came out on a positive note unlike last month’s figure. Results came out at six from a previous figure of four; this suggests business sentiment levels are higher. Aussie business conditions came out slightly negative for the economy. This sent a stalemate message to investors and the AUD levels were left essentially unchanged.
On a negative note to the Kiwi economy and dollar, the housing data that came out yesterday showed a 20% reduction in house sales YoY. This sparked only a minor initial reaction, however it wasn’t until late yesterday when we headed into the European session that investors saw another decline in the NZD. Investors are expecting the trend line to continue short term, as generally to break this trend the New Zealand economy has to push it in the other direction with data which is not there this week. However, if we see detrimental figures from the Aussie side of the pond in the Housing data released today we, may see some NZD strength; Thus far, it is looking unlikely to upset the market thus far.