NZD Rises 0.36% as Weak US Jobs Data Hits USD
The New Zealand Dollar (NZD) is gaining ground against the US Dollar (USD), rising by 0.36% to around 0.5890 on Friday. The strength of the NZD comes as a result of weak US jobs data, which saw Nonfarm Payrolls (NFP) fall by 23K in July, far short of market expectations for an increase of 80K jobs.
According to the Bureau of Labor Statistics (BLS), previous months were also revised sharply lower. The Unemployment Rate edged down to 4.1% from 4.2%, while the annual Average Hourly Earnings growth slowed to 3.2% from a revised 3.4%. This has led investors to scale back expectations of further monetary tightening by the Federal Reserve (Fed), causing the US Dollar to weaken.
The Reserve Bank of New Zealand's (RBNZ) hawkish stance is also providing support for the NZD, which continues to benefit from the central bank's monetary policy. Richmond Fed President Thomas Barkin noted that the latest employment figures reflect a labor market characterized by low hiring and low firing rather than a significant deterioration.