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

 


Kiwi at risk ahead of CPI and Dairy auction

08:08 AEST, Tuesday 15 April 2014

Kiwi at risk ahead of CPI and Dairy auction.

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

Wednesday poses as the key day for the NZD this week, with the release of an important data dump from China, the latest Online Dairy auction results, and Q1 CPI in New Zealand. Local traders have priced-in a 0.5% CPI increase for the March quarter, taking the annualised rate to 1.7%. Last fortnight’s Global dairy auction saw prices slump 8.9%, with the currency losing close to two cents. A combined drop of 18% in the past four auctions will significantly increase the focus on tonight’s auction result. The medium-term picture suggests the NZD remains at elevated levels around 0.8700, with daily technical indicators continuing to highlight bearish divergencies from recent traded highs.

Last week’s strong business confidence and manufacturing numbers were supportive of the currency, but it was the release of dovish FOMC minutes that took the NZD to a 3-year high of 0.8746. The minutes suggested US interest rates will remain lower for longer, with traders forced to unwind bets on a stronger USD. Risk aversion on the back of a broad selloff in global equities has capped the NZD however, and news of deadly clashes overnight between pro-Russian separatists and government forces in east Ukraine will limit traders appetite for risk further.

Chinese data on Wednesday includes industrial production and Q1 GDP, and this could have a big impact on commodity currencies. Last week’s Chinese trade numbers were terrible, showing large falls in both exports and imports, and this doesn’t bode well for the GDP read. A drop below the targeted 7.5% is expected, but the potential for additional stimulus measures from the PBOC has reduced somewhat following the release of higher consumer prices last week. This has the potential to impact the NZD, and more particularly the AUD, going forward.


ENDS

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Negotiations Fail: Christchurch Convention Centre Build To Proceed Without PCNZ

After protracted negotiations, the government has ditched the construction consortium it picked to build Christchurch's replacement convention centre, which it now anticipates delivering at least two years behind the original schedule. More>>

ALSO:

Ruataniwha: Greenpeace Launches Legal Challenge Against $1b Dam Plan

Greenpeace NZ is launching a legal challenge against a controversial plan to build a dam that’s set to cost close to $1 billion and will pollute a region’s rivers. More>>

ALSO:

Inequality: Top 10% Of Housholds Have Half Of Total Net Worth

The average New Zealand household was worth $289,000 in the year to June 2015, Statistics New Zealand said today. However wealth was not evenly distributed, with the top 10 percent accounting for around half of total wealth. In contrast, the bottom 40 percent held 3 percent of total wealth. More>>

ALSO:

What Winter? Temperature Records Set For June 20-22

The days around the winter soltice produced a number of notably warm tempertaures. More>>

Conservation Deal: New Kākāpō Recovery Partnership Welcomed

Conservation Minister Maggie Barry says the new kakapo recovery partnership between DOC and Meridian Energy is great news for efforts to save one of New Zealand’s most beloved birds. More>>

ALSO:

Tech Sector Report: Joyce Warns Asian Tech Investors View NZ As Hobbits And Food

Speaking in Wellington at the launch of a report showcasing the value of the technology sector to the New Zealand economy, Joyce said more had to be done to tell the country's technology stories overseas. More>>

ALSO:

Mediaglommeration: APN Gets OIO Approval For Demerger Plan

APN News & Media has received Overseas Investment Office approval for its plan to split out its NZME unit ahead of a potential merger with rival Fairfax Media's New Zealand operations. More>>

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news