18 May 2015
NZD/USD: Bears remains in control below 100/200 SMA's
FXStreet (Guatemala) - NZD/USD is currently trading at 0.7393 with a high of 0.7458 and low of 0.7381.
NZD/USD has continued in the bears hands and this is likely to remain that way with a solid bearish bias given the outlook of the RBNZ who are prepared to cut exchange rates and markets have started to price that in. RBNZ Governor Graeme Wheeler has been jawboning the currency of late and also mentioned the idea to lower borrowing costs as falling dairy incomes and global commodity prices threaten to curb economic growth.
He said April 30 it would be appropriate to lower the benchmark rate from 3.5 percent if demand weakens and near-zero inflation starts to damp wage and price-setting behaviour. Lower dairy prices, weak inflation expectations and the and a poorer looking labor market will all be closely watched by the RBNZ. On June 11th we will have the RBNZ's new economic forecasts.
One of the concerns are, however, that lower rates could add fuel to NZ's housing market and while Auckland’s boom is largely driven by a lack of housing supply and record immigration, there is the potential of overseas demand and investment increasing. Technically, the pair remains bearish while trading below the hourly 100 and 200 SMA's located at 0.7458 and 0.7444.
NZD/USD has continued in the bears hands and this is likely to remain that way with a solid bearish bias given the outlook of the RBNZ who are prepared to cut exchange rates and markets have started to price that in. RBNZ Governor Graeme Wheeler has been jawboning the currency of late and also mentioned the idea to lower borrowing costs as falling dairy incomes and global commodity prices threaten to curb economic growth.
He said April 30 it would be appropriate to lower the benchmark rate from 3.5 percent if demand weakens and near-zero inflation starts to damp wage and price-setting behaviour. Lower dairy prices, weak inflation expectations and the and a poorer looking labor market will all be closely watched by the RBNZ. On June 11th we will have the RBNZ's new economic forecasts.
One of the concerns are, however, that lower rates could add fuel to NZ's housing market and while Auckland’s boom is largely driven by a lack of housing supply and record immigration, there is the potential of overseas demand and investment increasing. Technically, the pair remains bearish while trading below the hourly 100 and 200 SMA's located at 0.7458 and 0.7444.