MUFG Research discusses NZD outlook in light of NZ lockdown extension.
"The main focus for the markets therefore remains the potential impediments to growth stemming from COVID and supply constraint uncertainties. In New Zealand today, PM Ardern announced a further extension to the Level 4 lockdown, which will now remain in place until midnight on 31st August. Ardern provided further guidance by stating that Auckland and the Northland region would remain at Level 4 for another two weeks but the rest of New Zealand could move to Level 3 from 1st September," MUFG notes.
"AUD and NZD are both advancing modestly versus the US dollar today suggesting much of the economic bad news is priced now. Risks remain to the downside however given that COVID infections could still worsen further," MUFG adds.