Kiwi Dollar Shows Resilience Amid Cautious Mood

NZD/USD edged higher for the second straight day Wednesday, as the kiwi outperformed all its G10 peers save for the sterling.

• The rate spiked to an intraday high of $0.5676 and promptly reversed the move around the release of FOMC minutes, which showed no intentions of making an imminent policy pivot.
• There was a parallel knee-jerk spike lower in AUD/NZD, which printed a two-month low in the process. The rate was weaker for the third consecutive day.
• In the grand scheme of things, weak performance from equity benchmarks post-Asia and a 0.7% decline in the BBG Commodity Index failed to dissuade participants from buying Antipodean currencies.
• Spot NZD/USD trades at $0.5612, little changed on the day. From a technical standpoint, bulls look for gains towards Oct 6 high of $0.5814, while bears keep an eye on Oct 11 cycle low of $0.5536.
• New Zealand's Food Price Index (FPI) rose 0.4% M/M in September, while annual growth remained at a 13-year high of +8.3%. Note that food contributes almost 19% to New Zealand's aggregate Consumer Price Index (CPI).
• Looking ahead, BusinessNZ M'fing PMI will cross the wires tomorrow. The index has stayed in expansionary territory since September 2021.