The Euro has continued its slow appreciation against the New Zealand Dollar today, rising to a rate of 1.6353.
The small advance in the pairing follows disappointing Eurozone inflation data but a surprise reduction in German unemployment.
In the latter case, the drop from 5.7% to 5.6% has put German unemployment at the lowest level since reunification in the 1990’s.
(Last updated September 28th, 2017)
The Euro has traded slightly higher against the New Zealand Dollar today, rising by 0.4% to hit an exchange rate of 1.6336.
This advance follows a set of forecast-beating Eurozone confidence measures for September.
On the month, business confidence and consumer confidence scores exceeded estimates, along with economic and services sentiment measures.
(First published September 28th, 2017)
- EUR NZD rate up at 1.6330 – NZD EUR rate slips to 0.6122
- Euro advances on resilient German confidence – Background concerns about German election remain
- New Zealand Dollar drops on lower growth forecast – RBNZ officials uncertain about economy
- Further Euro gains possible on confidence stats – NZ building permit data incoming
Due to fresh concerns about the formation of the new German government, the Euro declined against the New Zealand Dollar on Wednesday from a rate of 1.6366 to 1.6289.
Euro remains stable despite German Confidence Dip
Apart from lessening concerns about the new German government, the main Euro-limiting news today has been that the GfK German consumer confidence measure has slipped for October estimate.
This has been a mixed announcement – domestically, German consumers are apparently optimistic. On the international level, however, GfK analysts believe that North Korea, Brexit and conflict in the Middle East have all been limiting overall sentiment.
New Zealand Dollar Slides after RBNZ Downplays Rate Hike Odds
The New Zealand Dollar has lost ground against the Euro today, primarily due to Wednesday night’s Reserve Bank of New Zealand (RBNZ) policy meeting.
RBNZ officials left interest rates untouched, but this was widely expected. The more concerning development was that the bank gave no indication of moving to higher interest rates in the future.
In the words of RBNZ Acting Governor Grant Spencer;
‘Monetary policy will remain accommodative for a considerable period. Numerous uncertainties remain and policy may need to adjust accordingly’.
Responding to the news has been Dominick Stephens, economist at Westpac. Stephens said;
‘The RBNZ was never going to strike a bold new tone at this OCR review, given the pall of uncertainty that has been cast by the election. The acknowledgment of a lower growth outlook could hint [at] a more dovish November monetary policy statement’.
Future EUR NZD Forecast: Euro could Strengthen if Business Confidence Rises
Having already made gains against the New Zealand Dollar today, the Euro could firm in the near-future. This is dependent on Eurozone confidence measures for September which will come out shortly.
Estimates are for business confidence to rise, along with an improvement in finalised consumer confidence on the month.
Other confidence measures on the month have not been expected to move so positively, but as the business figure is considered ‘high-impact’, this could prove the greater influence on the Euro.
Additional Eurozone news out later today will be German inflation rate figures for September.
Annual core inflation is expected to rise, but the monthly core figure is conversely predicted to decline.
Yearly results are typically considered more impactful, which means that the Euro could once again appreciate on the news.
Later on, tonight will bring NZ building permit figures for August. On the month, permits are forecast to rise by 1.5%. Such a result would bode well for NZ construction activity, as well as ease the strain on the national housing supply.
Current Interbank EUR NZD Exchange Rates
At the time of writing, the Euro to New Zealand Dollar (EUR NZD) exchange rate was trading at 1.6330 and the New Zealand Dollar to Euro (NZD EUR) exchange rate was trading at 0.6120.