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Kiwi flags again at two-month highs; US jobs tonight

The NZDUSD saw another failure at the two-month highs overnight as the kiwi’s recent rally lost momentum.

Wednesday’s disappointing employment numbers saw the NZDUSD reverse sharply and overnight the kiwi remained unable to benefit from the USD dollar’s ongoing weakness.

The NZDUSD was flat with markets looking ahead to tonight’s critical US jobs report.

Aussie soars

In other markets, the NZD was mixed.

The NZD fell sharply versus the Australian dollar after a massive jump in the Australian trade position. The Australian December trade surplus was AUD3.5 billion in the largest result on record.

The NZDAUD fell 0.9%.

In Europe the NZD was higher, with the local currency up 0.2% versus the euro and up 1.0% against the British pound.

The pound was weaker after Bank of England governor Mark Carney indicated that there remains slack in the UK economy.

Key data

Two major economic releases can drive the NZD today.

From China, the closely-watched Caixin manufacturing activity index is due at 2.45pm. With Chinese growth recently improving, further signs of growth can boost the NZD.

From the US, tonight’s non-farm payrolls number will be key. The market expects 175k new jobs.

US job numbers have recently missed expectations as the low unemployment rate – at 4.7% – makes further growth hard work.

For more on February's upcoming events, please download out latest Risk Events Calendar.

By Steven Dooley -- Currency Strategist APAC

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