NZD plunges 7% in April as USD surges
• In April, the NZD hit both its high and low for the year, such was the extent of the NZD’s rapid decline from early April
• The USD surged to a 20-year high as Fed policy makers sanctioned a front-loaded tightening cycle; US 10-year up 60bps
• Much weaker risk appetite, spillover from Chinese yuan depreciation, and the soft NZ economy added to the NZD’s demise
Commodity currencies outperform in March
• Higher risk appetite and broad-based commodity price strength helped drive the NZD up 2½% in March
• Big gains on NZD crosses, as JPY, EUR and GBP all weakened; AUD outperformed and NZD/AUD hit a fresh nine-month low
• Global rates moved significantly higher as monetary policy tightening expectations ramped up
NZD recovers strongly in February
• After the hit suffered during January, the NZD recovered strongly in February, despite the further fall in risk appetite
• Russia invades Ukraine, with impact for NZD of soft risk appetite offset by commodity prices strength through February
• Strong global inflationary pulse remains a key theme; bonds prove no safe-haven as yields push higher everywhere