NZ Dollar Rises As Asian Shares Traded Higher

(RTTNews) - The New Zealand dollar strengthened against other major currencies in the Asian session on Monday, as Asian stock markets traded higher in reaction to the unexpected cooler-than-expected U.S. inflation for May.

While economists generally still expect the U.S. Fed to raise interest rates by another quarter point next month, the inflation data has added to optimism the central bank will not follow through with additional rate hikes.

The miners also pushed the stock market higher amid improved commodity prices.

In economic news, data from Statistics New Zealand showed that the total number of building permits issued in New Zealand in May was down a seasonally adjusted 2.2 percent on month in May, following the 2.6 percent drop in April.

The annual value of non-residential building work consented was NZ$9.9 billion, up 10 percent from the year ended May 2022.

Data from Caixin showed that the manufacturing sector in China continued to expand in June, albeit at a slower pace, with a manufacturing PMI score of 50.5.

That's down from 50.9 in May although it remains above the boom-or-bust line of 50 that separates expansion from contraction.

In the Asian trading today, the NZ dollar rose to 6-day highs of 1.7749 against the euro and 88.89 against the yen, from Friday's closing quotes of 1.7765 and 88.51, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 1.74 against the euro and 90.00 against the yen.

Against the U.S. and the Australian dollars, the kiwi advanced to 5-day highs of 0.6146 and 1.0826 from last week's closing quotes of 0.6135 and 1.0845, respectively. On the upside, 0.65 against the greenback and 1.05 against the aussie are seen as the next resistance levels for the kiwi.

Looking ahead, Switzerland CPI data for June is due to be release at 2:30 am ET in the pre-European session.

In the European session, PMI reports for June from different European economies and U.K. are slated for release.

In the New York session, U.S. ISM manufacturing PMI for June and U.S. construction spending data for May are set to be published.

At 8:00 am ET, European Central Bank policymaker Joachim Nagel will deliver a speech at a financial conference in Frankfurt, Germany.

Canadian markets are closed on account of Canada day.