The USD extended its Fed-fueled rally on Thursday. NZD weakness was no exception in that context. Economists at ANZ Bank note that the NZD/USD pair is heading towards support at 0.6550 and then more importantly, the 0.6500 level.
Upside risks to interest rates
“The kiwi remains in a pronounced downtrend vs USD as the market re-assesses the outlook for US interest rates.”
“Despite the speed of the fall in NZD/USD, the NZD is approaching key support at 0.6550 and 0.6500. The former is the 50% Fibonacci retracement of the entire up-move from March 2020, whilst the latter has historically provided strong support. Labour market data next week are a key focus.”