NZ Dollar Weakens As NZ Moves Into Lockdown
August 17 2021 - 2:09AM
RTTF2
The NZ dollar lost ground against its major counterparts on
Tuesday, as the nation's Prime Minister Jacinda Ardern announced a
three-day lockdown after detecting a single case of Covid-19 since
February.
The PM imposed a level 4 lockdown, under which schools, offices
and all businesses will be closed and essential services will
remain functional.
The infected man lives in Auckland and has visited the nearby
Coromandel region over the weekend. Both Auckland and the
Coromandel region will be in lockdown for seven days.
Authorities will not be able to identify whether this is a case
of the Delta variant until genome sequencing has been
completed.
Ardern said that the decision was made "on the basis that it is
better to start high and go down levels rather than to go low, not
contain the virus and see it move quickly."
The kiwi dropped to near a 3-week low of 0.6907 against the
greenback from Monday's close of 0.7016. On the downside, 0.68 is
possibly seen as its next support level.
The kiwi slipped to a 4-week low of 75.37 against the yen and a
2-week low of 1.7033 against the euro, down from Monday's closing
values of 76.62 and 1.6763, respectively. The kiwi is poised to
challenge support around 74.00 against the yen and 1.72 against the
euro.
The kiwi fell to a 2-week low of 1.0541 against the aussie,
after rising to 1.0420, which was its strongest level since
November 30, 2020. The kiwi may challenge support around the 1.07
mark.
Minutes from the Reserve Bank of Australia's August 3 meeting
showed that policymakers said the economic activity and employment
were expected to decline in the September quarter as the high
transmissibility of the Delta variant raised the possibility of a
more gradual reopening.
The board said outbreaks of the Delta variant and accompanying
lockdowns had introduced a high degree of uncertainty to the
outlook for the second half of 2021.
Looking ahead, Canada housing starts for July are scheduled for
release at 8:15 am ET.
U.S. NAHB housing market index for August, business inventories
for June, retail sales and industrial production for July will be
featured in the New York session.
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