It’s been a hectic few days in forex markets. The week opened with a huge gap lower in the Euro after the Greek referendum decision. That saw the US dollar strengthen across the board.
But for the New Zealand dollar, the pressure has continued to build as weak milk prices and dairy auctions, together with a growing expectation that the RBNZ is likely to completely unwind last years 100 points of rate hikes weighs.
It’s broken 67 cents in trade today and is now closing in on the lowest levels it’s traded at in 5 years.
The Canadian dollar has been thumped this week as well and Thursday afternoon, it seems that with AUDNZD up at 1.14 ,traders are selling Aussie dollars in sympathy with our commodity bloc cousins the Kiwi and Loonie (that’s what forex traders call the Canadian dollar).
It’s sitting just above 76 cents now. That’s only 30 points above the low for the week and less than 100 points above the lows for the year in the 0.7530 region.
Tonight’s non-farm payrolls in the US is crucial as to whether these important levels are tested, hold, or break.