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

 


Kiwi eyes 0.8500 as pullback continues

Kiwi eyes 0.8500 as pullback continues


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

The NZ Dollar continues its downward correction from the over-extended highs of early April, when bearish technical divergences warned the upside momentum above 0.8700 was waning. Initial support is now seen at 0.8500, but with the situation in Ukraine continuing to worsen there remains an extended downside risk if the global risk appetite reduces. The NZD has performed well against the AUD however, following a benign inflation reading in Australia last week. This suggests the RBA are likely to remain on hold for some time, and favours an appreciating NZD/AUD cross.

The OCR increase from the RBNZ last week was anticipated by the market, and resulted in a modest rally which was unable to break above the 0.8640 resistance level. A further hike in June remains likely, but the RBNZ indicated the extent of further increases will be data dependent. With the TWI currently around 1.7% higher than the level forecast in the March MPS, the market is reassessing the requirement for the 200pts of hikes over two years indicated in March, suggesting the Kiwi may still be expensive around current levels.

Tonight’s GlobalDairyTrade auction result will be watched closely again following the 20% fall in the previous five auctions. The impact of these falls will be evident when the Commodity Price Index for April is released on Friday, but major direction for the week is likely to come from events in the US. Thursday’s FOMC meeting is likely to see a further $10 bio of QE tapering, which will take monthly bond purchases down to $45 bio, but FED Chairman Yellen’s speech on Friday is likely to reaffirm US rates will remain low for a considerable period. The week finishes with the April Non-Farm Payrolls on Friday night, with the market looking for the creation of over 200K new jobs and a decline in unemployment to 6.6%.

Ends

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Housing Policy: Auckland Densification As Popular As Ebola, English Says

Finance Minister Bill English said calls by the Reserve Bank Governor for more densification in Auckland’s housing were “about as popular in parts of Auckland as Ebola” would be. More>>

ALSO:

Crown Accounts: NZ Government Deficit Smaller Than Expected In First Half

The New Zealand government's operating deficit was smaller than expected in the first six months of the financial year, as the consumption and corporate tax take rose ahead of forecast in December, having lagged estimates in previous months. More>>

ALSO:

Fruit & Veg Crackdown: Auckland Fruit Fly Find Under Investigation

The Ministry for Primary Industries (MPI) is investigating a find of a single male Queensland fruit fly in a surveillance trap in the Auckland suburb of Grey Lynn... MPI has placed legal controls on the movement of fruit and some vegetables outside of a defined circular area which extends 1.5km from where the fly was trapped in Grey Lynn. More>>

ALSO:

Scoop Business: Westpac NZ Reaches $2.97M Swaps Settlement

Westpac Banking Corp’s New Zealand unit has agreed to pay $2.97 million in a settlement with the Commerce Commission over the way the bank sold interest rate swaps to farmers between 2005 and 2012. More>>

ALSO:

Going Dutch: Fonterra Kicks Off $144M Partnership With Dutch Cheese Maker

Fonterra Co-operative Group, the world’s largest dairy exporter, has commissioned a new dairy ingredients plant in Heerenveen, in the north of the Netherlands, its first wholly-owned and operated ingredients plant in Europe. More>>

ALSO:

Scoop Business: NZ Retail Sales Beat Estimates

New Zealand retail sales rose more than expected in the fourth quarter, led by vehicle-related transactions, food and beverages, adding to evidence that cheap credit and a growing jobs market are encouraging consumers to spend. More>>

ALSO:

Delivery Cuts Go Ahead: 'Government Money Grab' From NZ Post

"It's a money grab by the Government as the shareholder of New Zealand Post" says Postal Workers Union advocate Graeme Clarke about the changes announced by NZ Post. More>>

ALSO:

Get More From Scoop

 
 
Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news