NZD/USD Fundamental Forecast – June 2, 2016

The New Zealand Dollar strengthened against most major currencies in the Asian session on Wednesday. The NZD/USD rose to more than a 2-week high of .6812, before settling at .6782, up 0.0021 or +0.31%.

Upside momentum created by Tuesday’s positive data from New Zealand along with strong GDP data from Australia on Wednesday boosted the New Zealand Dollar and Australian Dollar although gains were limited by support for the US Dollar.

Boosting the Kiwi on Tuesday was positive data showing the ANZ business confidence index for New Zealand increased to 11.3 this month, a jump from April’s reading of 6.2.

The New Zealand Dollar also piggy-backed a sharp rise by the Australian Dollar, which was triggered by robust GDP data. The report showed the country’s economy grew 3.1 percent (YoY) in the first quarter of 2016 versus 2.8 percent expected and 2.9 percent in the fourth quarter (4Q) of 2015. This was the fastest pace of yearly expansion since the third quarter of 2012.

The sharp rise by the Aussie Dollar helped improve risk sentiment within the commodity block of currencies, helping to underpin the Kiwi although most of the buying was primarily short-covering. This news also eases pressure on the Reserve Bank of New Zealand to act, which is supportive for the currency.

The NZD/USD is expected to remain firm throughout the session, however, gains may be limited by position-squaring and profit-taking after the two-day surge and ahead of the U.S. Non-Farm Payrolls report on Friday.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

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Upcoming Economic Events that you should be monitoring:

Thursday, June 2, 2016

Government Bond Auctions

Jun 01 10:30 Denmark Holds bond auction

Jun 01 11:30 Germany Eur 4bn 0% Apr 2021 Bobl

Jun 01 11:30 UK Gbp 2.75bn 1.5% 2021 Gilt

Jun 01 17:20 Sweden Announces details of bond auction on Jun 08

Jun 02 10:30 Spain Holds bond auction

Jun 02 10:50 France Eur 8-9bn 2.25% May 2024, 0.5% May 2026 & 3.25%

Jun 02 11:03 Sweden Sek 0.5bn 0.125% 2019 I/L & Sek 0.5bn 0.125% 2026 I/L bonds

Jun 06 13:00 Norway Details of bond auction on Jun 08

Jun 07 11:00 Netherlands Eur 4-6bn Jan 2022 DSL

Jun 07 11:00 Austria Holds bond auction

Jun 07 11:30 Germany Holds I/L bond auction

Jun 07 11:30 UK 4.5% 2046 Gilt

Jun 08 11:03 Sweden Holds bond auction

Jun 08 11:05 Norway Holds bond auction

Jun 08 11:30 Germany Eur 5bn Jun 2018 Schatz

Jun 08 17:20 Italy Announces details of bond auction

Jun 09 11:30 UK 0.125% 2036 I/L Gilt

Jun 09 17:20 Sweden Announces details of I/L auction on Jun 16