- NZD/USD rises 0.63% to hit a 19-month high of 0.6812.
- Investors foresee easing of global tensions, less regulatory changes under Biden presidency.
The NZD/USD pair extends last week’s gains as the Kiwi dollar continues to draw bids on New Zealand’s relative success in controlling coronavirus and risk-on action in the global equity markets.
At 19-month highs
The pair is currently trading at 0.6812, the highest level since early April 2019, representing a 0.63% gain on the day, having carved out a 2.4% rally last week.
The NZD is not a traditional safe haven like the US dollar, Japanese yen, and Swiss Franc. However, investors look to be treating it as a haven currency amid the resurgence of coronavirus across Europe and the US. Besides, investors expect the Sino-U.S. relationship to ease under Democrat Joe Biden’s presidency.
According to Associated Press, Biden has won the US presidential elections held on Nov. 3. However, the election has resulted in a split Congress, as opposed to the Democratic blue wave projected by investors while heading into the vote. Investors believe the split Congress would make it harder for Biden to pass sweeping regulation and tax hikes. And while prospects of a big fiscal stimulus have also diminished with the split Congress, investors remain confident that the Federal Reserve would do the heavy lifting.
As such, the dollar remains under pressure and the antipodean is on the rise.
Technical levels
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