21 Jul 2015
NZD/USD: Waiting for RBNZ's chief vs Key's intervention
FXStreet (Guatemala) - NZD/USD is currently trading at 0.6561 with a high of 0.6576 and a low of 0.6555.
NZD/USD has had a better day in the falling trend line on the daily and is recovering in a minor fashion from the 0.67 downside of lats week's business.
NZD/USD fundamentals, RBNZ round the corner
Fonterra’s GlobalDairyTrade price index recently dropped 10.7% and that was the catalysts for further downside within April's business that triggered the sell-off from above the 0.77 handle to over 1200 pips lower. Accompanying the sell-off over the last few months on poor domestic data forcing the RBNZ's hand for a rate cut in June of 0.25bps down to 3.25%, has been external global risk also, such as Greece and China, leaving the bird exposed to dovish speculators.
The retail crowed are currently supporting the bird but running up to the RBNZ, and taking in to account the dismal Q1 results when GDP came in at a meager 0.2% for the quarter, lower than the estimated 0.6% expansion, as well as falling commodities, weak exports, downturns in manufacturing and poor consumer confidence, one would expect that the RBNZ needs to do something and soon, exposing the downside again. Indeed, markets expect another 0.25% and a dovish accompanying statement also in respect of the September meeting which should all point to a lower NZD/USD.
However, the bird is already falling further than expected by Prime Minister John Key who recently warned. It will be interesting to thus hear what the banks chief, Graeme Wheeler, has to say about the price. Technically, 0.6580/00 is acting as resistance and failures here bring back the bears target for 0.6420.
NZD/USD has had a better day in the falling trend line on the daily and is recovering in a minor fashion from the 0.67 downside of lats week's business.
NZD/USD fundamentals, RBNZ round the corner
Fonterra’s GlobalDairyTrade price index recently dropped 10.7% and that was the catalysts for further downside within April's business that triggered the sell-off from above the 0.77 handle to over 1200 pips lower. Accompanying the sell-off over the last few months on poor domestic data forcing the RBNZ's hand for a rate cut in June of 0.25bps down to 3.25%, has been external global risk also, such as Greece and China, leaving the bird exposed to dovish speculators.
The retail crowed are currently supporting the bird but running up to the RBNZ, and taking in to account the dismal Q1 results when GDP came in at a meager 0.2% for the quarter, lower than the estimated 0.6% expansion, as well as falling commodities, weak exports, downturns in manufacturing and poor consumer confidence, one would expect that the RBNZ needs to do something and soon, exposing the downside again. Indeed, markets expect another 0.25% and a dovish accompanying statement also in respect of the September meeting which should all point to a lower NZD/USD.
However, the bird is already falling further than expected by Prime Minister John Key who recently warned. It will be interesting to thus hear what the banks chief, Graeme Wheeler, has to say about the price. Technically, 0.6580/00 is acting as resistance and failures here bring back the bears target for 0.6420.