NZ & Australian Dollar Weak Against the USD

2 min read | March 23, 2021 07:03 PM AEDT | By Manika

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NZ & Australian Dollar Weak Against the USD

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Summary

Australian and NZ dollars are weak due to lowering of crude and iron ore prices

It is also a result of Turkish Lira falling by almost 15% during the day

In the past weeks, even though several currencies showed weakness against the USD, Australian and New Zealand Dollar remained firm

Fall in Turkish Lira and softening of crude (oil) prices and iron ore are having an impact on the currency market. Australian dollar and NZ dollar which were holding forth till now, lost some ground on Monday. Currency market players started buying the US dollar for safety on the news of collapse of Turkish Lira.

According to currency market analysts, the Australian and NZ dollars are likely to remain volatile for sometime.

For the first time after several weeks, the AUD and NZD showed weakness against the USD.
The Australian dollar was down by 0.46% at a low of NZ$0.7708 for the fourth day. The New Zealand dollar dropped 0.32% to $0.7145 but showed some recovery in the later part of the day.

However, according to analysts, in the coming weeks, the thing to watch will be the direction of US treasuries as rising yields will have an impact on the NZ and Australian dollar. According to economists, rising yields are going to be a big challenge for the Australian dollar, along with that the commodity prices lower than before can add to the challenge.

Last week, the US dollar rose against several currencies ahead of the anticipated speech by the Fed chief Jerome Powell. The dollar gained against the Yen and Swiss Franc. However, Australian dollar and New Zealand dollar were not influenced by the increase in the USD.

The New Zealand dollar has remained unchanged at NZ$0.7199 far from its February high of NZ$0.7464.

After the Fed speech, the two currencies remained strong. The policy settings remained unchanged and no significant movement happened in the currency market.

Analysts were very bullish on Australian and NZ dollars last week, saying that they are likely to continue rising as both countries are seeing an economic recovery, as a result will benefit from the spurt in global trade.

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