NZD/CHF

The NZD/CHF is the currency pair encompassing the New Zealand dollar of the Realm of New Zealand (symbol $, code NZD), and the Swiss franc of Switzerland (code CHF).

The pair’s exchange rate indicates how many Swiss Francs are needed in order to purchase one New Zealand dollar.

For example, when the NZD/CHF is trading at 0.6500, it means 1 New Zealand dollar is equivalent to 0.65 Swiss Francs.

The New Zealand dollar (NZD) is the world’s tenth most traded currency, whilst the Swiss franc (CHF) is the world’s sixth most traded currency.

This results in a cross of relatively low liquidity with high spreads that most forex brokers quoting a spread of between 2 and 6 pips.

How to Trade the NZD/CHF

Its volatility is fairly muted and the range over a period of 24 hours often struggles to surpass 100 pips.

Nevertheless, there is ample price action which is frequently erratic, making the NZD/CHF is one of the more difficult pairs to trade.

In particular, the NZD can be characterized as a carry trade currency that is relatively high yielding.

There are several economic readings of importance in New Zealand that are capable of affecting the NZD, namely dairy prices and tourism metrics.

Presently, New Zealand is the world’s largest exporter of whole milk powder. An increase in milk prices will help stimulate the New Zealand economy and the NZD in parallel.

The NZD is known as a risk-correlated currency because of the mix of high interest rates and exposure to global economic performance.

Consequently, the NZD/CHF cross offers an alternative risk play.