NZD: New Zealand Dollar continues rising steadily

At the Forex currency market the New Zealand Dollar rate continues strengthening.

Forex forecast: MACD indicator is in the negative area for the pair NZD/USD and continues to rise, giving a pair buy signal. Stochastic Oscillator is in the overbought zone, giving a pair the same signal.

Forex recommendations: in case current market sentiment remains intact and breakup of the level 0.7600 occurs, buyers’ targets will become the levels of 0.7610 and 0.7630.

The situation in the New Zealand economy remains unchanged on Wednesday. As it became known the day before, trade balance in New Zealand increased to NZ$194 mln in February against the level of NZ$11 mln in January and forecast of growth to NZ$272 mln. In addition export levels increased by 17% y/y, import – by 23% y/y.

At the last meeting the Reserve Bank of New Zealand decided to decrease interest rate by 50 basis points, to the level of 2.50% per annum. Investors, who had predicted possible reduction of the indicator, ignored its decrease by 25 basis points.

It became the reason of the dramatic fall of the NZD, and what is more, Prime Minister John Key said earlier in his interview to Bloomberg News that he would have approved the decision of the Reserve Bank of New Zealand to reduce interest rate.

Statistics released showed that GDP in New Zealand rose by 0.2% m/m (+0.8% y/y) in QIV against the forecast of growth by 0.1% m/m, which support positive dynamics in NZD.

Statistics of the last week showed that balance of current account in New Zealand decreased to -NZ$3.5 billion against the value of -NZ$1.77 billion in QIII. The balance is most likely decreased due to the seasonal factors and we surely can see improvement in the situation.

 

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