The New Zealand dollar was almost unchanged against its U.S. counterpart on Monday, one-and-a-half month lows as investors remained cautious over China and as Friday’s strong U.S. jobs report lent some support to the greenback.
NZD/USD hit 0.6559 during late Asian trade, the session high; the pair subsequently consolidated at 0.6538.
The pair was likely to find support at 0.6491, the low of November 23, and resistance at 0.6593, the high of November 30.
Sentiment slightly recovered after the China Securities Regulatory Commission suspended its stock market circuit breaker and after the People’s Bank of China set a higher yuan guidance rate for the first time in nine days late last Thursday.
But concerns over slowing growth in China persisted. While investors had expected the central bank to allow the yuan to fall further after last year’s 4.5% depreciation, the rapid pace of last week’s devaluation fueled fears that the world’s number two economy is growing even more slowly than expected.
China is New Zealand’s second-biggest export partner.
Meanwhile, the greenback found some support after the Labor Department reported on Friday that the U.S. economy added 292,000 jobs last month, after increasing an upwardly revised 252,000 in November. Economists had forecast payrolls to rise by 200,000.
The unemployment rate held steady at a seven-and-a-half year low of 5% in December.
The report bolstered expectations that the Federal Reserve could raise interest rates at a faster pace this year. Higher U.S. interest rates would make the dollar more attractive to yield-seeking investors.
The kiwi was lower against the Australian dollar, with AUD/NZD rising 0.36% to 1.0665.