Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


NZD range-trade favoured

NZD range-trade favoured


By Garry Dean (Sales Trader, CMC Markets New Zealand)


Fed Chairman Janet Yellen’s assertion last week that US interest rates may begin to rise in the second quarter of 2015 weighed heavily on the New Zealand dollar. The forecast increase in the Fed Funds Rate to 1.00% at the end of 2015, and 2.25% at the end of 2016 sparked a USD rally, which abruptly halted the NZD advance above 0.8600. This has in essence defined the trading range for the week, with resistance seen at recent highs of 0.8640, and solid support at the early March lows of 0.8440.

Concerns regarding the slowdown in Chinese growth remains a risk for the NZD, but in the short term the modest weakness seen following yesterday’s disappointing China flash PMI reading was encouraging for the NZD. Market expectation of policy stimulus from Beijing to ensure growth doesn’t fall below 7.50% is becoming more widespread. Investors may note a recent Bloomberg analyst survey showed the median estimate for full year Chinese GDP dropped to the weakest annual pace since 1990, at 7.4%. Clearly the expectation of some form of policy measures to stabilise growth is increasing, and this has again provided support for the NZD and AUD overnight.

Domestic data is continuing to impress, with last week’s December GDP reading beating RBNZ forecasts and highlighting a more broad-based recovery in the New Zealand economy. Thursday sees the only local economic release, with the February Trade Balance expected to show an improvement, led again by increasing exports. The release of China’s Leading Indicator number at 15:00 NZ time today could also provide some volatility for both the AUD and NZD.

ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Must Sell 20 Petrol Stations: Z Cleared To Buy Caltex Assets

Z Energy is allowed to buy the Caltex and Challenge! petrol station chains but must sell 19 of its retail sites and one truck-stop, the Commerce Commission has ruled in a split decision that acknowledges possible retail price coordination between fuel retailers occurs in some regions. More>>

ALSO:

Huntly: Genesis Extends Life Of Coal-Fuelled Power Station To 2022

Genesis Energy will keep its two coal and gas-fired units at Huntly Power Station operating until 2022, having previously said they'd be closed by 2018, after wringing a high price from other electricity generators who wanted to keep them as back-up. More>>

ALSO:

Dammed If You Do: Ruataniwha Irrigation Scheme Hits Farmer Uptake Targets

Enough Hawke's Bay farmers have signed up for water from the proposed Ruataniwha Water Storage Scheme for it to go ahead as long as a cornerstone institutional capital investor can be found to back it, its regional council promoter announced. More>>

ALSO:

Reserve Bank: OCR Stays At 2.25%

Reserve Bank governor Graeme Wheeler kept the official cash rate at 2.25 percent, in a decision traders had said could go either way, while predicting inflation will pick up as the slump in oil prices washes out of the data and capacity pressures start to build in the economy. More>>

ALSO:

Export Values Down: NZ Posts Biggest Annual Trade Deficit In 7 Years

New Zealand has recorded its biggest annual trade deficit since April 2009, reflecting weaker prices of agricultural commodities such as dairy products, beef and lamb, and increased imports of vehicles and machinery. More>>

ALSO:

Currency Events: NZ's New $5 Note Wins International Banknote Award

New Zealand’s new Brighter Money $5 note has been named Banknote of the Year in a prestigious international competition. The $5 note was awarded the IBNS Banknote of the Year title at the International Bank Note Society’s annual meeting. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news