NZD/USD Near 0.6000 as Kiwi Momentum and Risk Appetite Drive Rally

The New Zealand Dollar is nearing its highest level since late May, trading close to 0.6000 as it extends its advance on Friday. This rally is being driven more by strong Kiwi momentum and improving risk appetite than by changing expectations for Federal Reserve policy.

The latest US economic data showed private-sector activity accelerating in August, with the Flash S&P Global Services PMI rising strongly and exceeding expectations. However, the Manufacturing PMI weakened and fell short of forecasts, which failed to give the US Dollar meaningful traction.

China's decision to leave its benchmark lending rates unchanged also provided stability for currencies sensitive to Chinese economic demand. As a major trading partner for New Zealand, developments in China remain relevant for the New Zealand Dollar.