15 Jul 2015
NZD/USD in heavily bearsish territory
FXStreet (Guatemala) - NZD/USD is currently trading at 0.6600 with a high of 0.6724 and a low of 0.6582.
NZD/USD is trading at 5-year lows having dipped its toes in to the 0.65 handle.
NZD/USD has been in string decline since July 2014 and has not been able to recover since Wheel calling for a pause in interest rate hikes when he said in his statement, “it is prudent that there now be a period of assessment before interest rates adjust further.” Since then, the RBNZ has been tipped to possibly act again in the early part of 2015 but a series of economic headwinds leading in to 2015 prevented them doing so and in fact turned dovish.
The Reserve Bank cut the benchmark rate a quarter-point in June to 3.25% and signalled more may be on the way as the dairy sector's weak outlook weighed on the nation's terms of trade and threatened to delay an increase in inflation from its near-zero level. Earlier, we witnessed another sell off in the bird on the back of Fonterra’s GlobalDairyTrade price index that dropped 10.7%, which equates to the probability of the RBNZ cutting rates again this year and at the same time the greenback was boosted yet again with better than expected PPI's and Yellen’s fairly hawkish speech.
Technically, we are entering significant bearish territory and a break of 0.6580 opens scope for 0.6420. We await Q2 CPI's from New Zealand tonight that could be the next catalyst to trigger a deeper trend.
NZD/USD is trading at 5-year lows having dipped its toes in to the 0.65 handle.
NZD/USD has been in string decline since July 2014 and has not been able to recover since Wheel calling for a pause in interest rate hikes when he said in his statement, “it is prudent that there now be a period of assessment before interest rates adjust further.” Since then, the RBNZ has been tipped to possibly act again in the early part of 2015 but a series of economic headwinds leading in to 2015 prevented them doing so and in fact turned dovish.
The Reserve Bank cut the benchmark rate a quarter-point in June to 3.25% and signalled more may be on the way as the dairy sector's weak outlook weighed on the nation's terms of trade and threatened to delay an increase in inflation from its near-zero level. Earlier, we witnessed another sell off in the bird on the back of Fonterra’s GlobalDairyTrade price index that dropped 10.7%, which equates to the probability of the RBNZ cutting rates again this year and at the same time the greenback was boosted yet again with better than expected PPI's and Yellen’s fairly hawkish speech.
Technically, we are entering significant bearish territory and a break of 0.6580 opens scope for 0.6420. We await Q2 CPI's from New Zealand tonight that could be the next catalyst to trigger a deeper trend.