NZD: Sales of New Zealand Dollar have been resumed after an interval

At the Forex currency market the New Zealand Dollar rate started to decline over again on Monday, because external background has aggravated once again.
Forex forecast: MACD indicator is in the positive area for the pair NZD/USD; it is moving down, giving a sell signal, while volumes are low.  Stochastic Oscillator remains in the oversold zone, and maintains a sell signal.

Forex recommendations: in case of breakdown at the level of 0.8270, the pair will go to 0.8250 and 0.8230. If downward breakdown does not take place, the pair will consolidate close to the current levels.

Economic situation in New Zealand has not changed fundamentally on Monday morning.

The AUD is not very popular with traders at the moment, which can be logically explained: as long as economic uncertainty persists in the world, there will be few volunteers who are eager to take risk. The environment has aggravated today due to the downgrade of the U.S. rating and expanding of the debt problems in Eurozone.

CPI in New Zealand rose by 1.0% q/q (+5.3% y/y) in Q2 against the forecast of growth by 0.8% on quarterly basis. It is one more positive characteristic of the economic status in New Zealand.

At the meeting last week, the Reserve Bank of New Zealand decided to leave interest rate at the previous level of 2.5% per annum. In the follow-up comments the RBNZ said that monetary policy tightening which has been planned for the nearest future is aimed to duly curb the rise in prices in the country. As the head of the Bank, Mr. Bollard noted:”World financial risks have begun to fade out and economic growth continues to accelerate pace; therefore, there is no sense to maintain the rate at the current low level any further.”

In addition, it became known this week that unemployment rate in New Zealand amounted to 6.5% in Q2 against revised similar value in Q1. Employment rate in New Zealand has not changed on quarterly basis in Q2, showing growth by 2.0% y/y, to 2.214 million. In general the data agreed with the economists’ forecast, unemployment rate had been even below consensus forecast of 6.6%. However, this did not prevent sales of the NZD.

It is worth noting that permits for construction in New Zealand fell by 1.4% m/m in June against the forecast of +3.0%. Trade balance in New Zealand increased by NZ$230 billion in June against the forecast of NZ$400 billion. Slowdown in surplus was logical in June: volume of growth rate in imports and exports fell last month. Thus exports increased by 4.5% in Q2, to NZ$12.2 billion; imports dropped by 1%, to the level of NZ$11.8 billion. Exports to China and Australia fell sequentially: to +1.3% y/y (+24.2% y/y earlier) and 1.2% y/y (+4.7% y/y earlier) respectively.

Wide spread risk aversion still remains the main driver for the pair NZD/USD.