NZD/USD Fundamental Forecast – September 5, 2016

The NZD/USD added 4 points to 0.7289 as commodity currencies and Asian markets are holding tight with traders sidelined ahead of the Nonfarm payroll jobs. The US dollar eased over the past days off its 96 level to trade at 95.64. ScoopNZ reported that The New Zealand dollar gained as the US dollar index declined following a weaker-than-expected ISM manufacturing report while the market looks ahead to tonight’s key non-farm payrolls report for clues on the timing of US interest rate hikes.

Data showed the volume of building work put in place rose a seasonally adjusted 5.5 percent in the three months to June. The growth was almost equally balanced between house building and non-residential. Auckland led the charge, rising 13 percent in the June quarter, though the lift in construction is spread across the country.

The US dollar index dropped to 95.616, a three-day low, after the US manufacturing ISM report for August dropped to 49.4 from 52.6 percent in July. Economists had expected a more modest decline to 52. The dollar index is still well above the 94.631 level of a week ago, before Federal Reserve chairwoman Janet Yellen and vice chairman Stanley Fischer talked up the data-dependent prospects of interest rate hikes, bringing more focus on tonight’s payrolls report.

The market expects the US economy added 180,000 jobs in August, down from 255,000 in July. Speizer said Westpac’s forecast is a tad lower at 170,000. “Employment gains are likely to see the unemployment rate edge back down to 4.8 percent,” he said in a note. “As is always the case, that depends on participation.”

FxEmpire provides a wide variety of analysis on a daily, weekly and monthly basis ranging from our exceptional technical analysis as well as our in-depth fundamental analysis along with our daily news and market updates. To get the best understanding of each asset it is important to review the short term daily analysis with the longer term monthly reports. To get email notification when each of these are posted please sign up for our daily newsletter.

Upcoming Economic Events that you should be monitoring:

 September 5, 2016

Government Bond Auctions

Date Time Country Auction

Sep 06 11:00 Austria Holds bond auction

Sep 06 11:30 UK 1.5% 2026 Gilt

Sep 06 11:30 Germany Holds I/L bond auction

Sep 07 10:30 Denmark Holds bond auction

Sep 07 11:03 Sweden Holds bond auction

Sep 07 11:30 Germany Eur 5bn 0% Aug 2026 Bund

Sep 08 11:00 Ireland Holds bond auction

Sep 08 17:20 Italy Announces details of bond auction