NZD: New Zealand Dollar tries to grow at the beginning of the week

The New Zealand rate is traded upward at the Forex currency market on Monday, trying to get out of the three -day range.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD and is moving along the signal line, preventing from forming a clear signal. Stochastic Oscillator is giving a pair buy signal today being in the overbought zone.

Forex recommendations: if bullish sentiment intensifies for the pair and in case of breakdown at the level of 0.7725 buyers’ target will be the level of 0.7800 and a new local high of 0.7840.

It became known last week that level of business sentiment in New Zealand in QIV rose to 8 points, as per NZIER estimates, against the previous level of 6 points. It is a positive indicator for the NZD; amid natural disaster in Australia and the fall of AUD, the New Zealand currency looks attractive at the moment among the high yielding currencies.

In general the economy in New Zealand has remained unchanged.

Ministry of Finance takes a dark view of the economic outlooks of the country; therefore, earlier they downgraded the forecast of economic growth for the current and the next fiscal years. In particular, estimate of GDP growth for the next fiscal year which starts on 1 June was brought down to 2.2% against the previous target level of 3.2%. In 2012 monetary politicians expect economic growth to 3.4%; however later, in 1015, economic growth in New Zealand will slow down again to - 2.7%

Note also, that budget deficit is assumed in the country, which is expected to increase from the current 14.1% of GDP to 28.5% of GDP by June 2015.

Interest rate of the Reserve Bank of New Zealand is now at the level of 3.0% per annum. Commenting the last RBNZ meeting the regulator noted that the rate of the monetary policy tightening is expected to be moderate in the next two years, since the earthquake which happened in the country recently (and which was the strongest over the last 80 years) had a significant impact on the state of the national economy.

Regulator’s meetings in 2011 are scheduled for 26 January, 9 March, 27 April, 8 June, 27 July, 14 September, 26 October and 7 December.