New Zealand PPI Data Positive, NZ Dollar Among Strongest

Commodity currencies were among the strongest on the Forex market during Friday’s trading, with the New Zealand dollar outperforming all other most-traded counterparts, except for the Australian dollar. Domestic macroeconomic data released overnight was largely positive but did not give the New Zealand currency a noticeable boost.
Statistics New Zealand reported that the output Producer Price Index rose by 0.4% in the December quarter of 2020. That is compared with the previous quarter’s drop of 0.3% and a decline of 0.2% predicted by analysts. The input PPI was flat, versus the forecast increase of 0.1% and the previous quarter’s gain of 0.6%. The largest gains in output were registered in forestry and logging (3.8%) as well as dairy cattle farming (2.7%), while sheep, beef cattle, and grain farming fell by 0.8%. Input rose mostly in dairy product manufacturing (2.2%), while fell in meat and meat product manufacturing (0.8%) and sank in petroleum and coal product manufacturing (5.5%).
The rally of commodity-related currencies, including the New Zealand dollar, and the retreat of safer currencies, most notably the US dollar, suggested that markets were in a risk-on mode. That was surprising considering that many Asian stocks have been trading with losses, while all of major US stock indices closed lower. On the positive side, though, all European stock indices demonstrated gains on Friday.
NZD/USD rallied from 0.7217 to 0.7290 as of 13:00 GMT today. EUR/NZD dropped from 1.6734 to 1.6643, trading near the lowest level since December 2019. Meanwhile, AUD/NZD rose from 1.0752 to 1.0776, reaching the daily maximum of 1.0793 intraday.
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Original from: www.earnforex.com