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NZD/USD Fundamental Analysis – August 7, 2015 – Forecast

Barry Norman
NZD/USD is Trading Sideways
NZD/USD is Trading Sideways

Analysis and Recommendation:

The NZD/USD recovered 29 points to 0.6542 taking advantage of a decline in the Aussie and the US dollar after traders realized that they had pushed the currency too low.  The possible milk payout forecast by DairyNZ CEO Tim Mackle, based on Open Country, of $4 per kilogram of milk solids has the potential to hit the average dairy farm by $250K according to KPMG analysis. The New Zealand dollar dipped below 65 US cents for the first time in six years as better than expected US data revived optimism about the strength of the world’s biggest economy, and stoked expectations the Federal Reserve will start hiking interest rates.

The kiwi has also been under pressure as slumping global milk prices prompted the Reserve Bank to embark on looser monetary policy in June, and this week’s latest decline caused local economists to downgrade their expectations for Fonterra Cooperative Group’s forecast payout to farmers to below $4 per kilogram of milk solids. Fonterra’s board will review the price on Friday.

Markets are divided on whether the Fed will start raising interest rates from the near-zero policy it’s been running since the global financial crisis, and upbeat data is seen as making a hike more likely. Friday’s release of non-farm payrolls for July are the next big indicator for the US economy, and will be closely watched after a private payrolls report came in below expectations.

FxEmpire provides in-depth analysis for each currency and commodity 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.

Today’s economic releases:

Cur.

 

Event

Actual

Forecast

Previous

 

  AUD

 

Employment Change (Jul)

38.5K

10.0K

7.0K

   

  AUD

 

Full Employment Change (Jul)

12.4K

 

24.9K

   

  AUD

 

Unemployment Rate (Jul)

6.3%

6.0%

6.1%

   

 

Upcoming Economic Events that you should be monitoring:

Friday, August 7, 2015

Cur.

 

Event

Actual

Forecast

Previous

 

  JPY

 

BoJ Press Conference  

 

 

 

 

 

  USD

 

Nonfarm Payrolls (Jul)

 

223K

223K

 

 

  USD

 

Unemployment Rate (Jul)

 

5.3%

5.3%

 

 

  CAD

 

Employment Change (Jul)

 

5.0K

-6.4K

 

 

  CAD

 

Ivey PMI (Jul)

 

52.0

55.9

   

Government Bond Auctions

Date Time Country

Aug 06 10:30 Spain Auctions Bonos

Aug 06 11:10 France Auctions OATs

Aug 10 17:30 Italy Announces details of BTP/CCTeu on 13 Aug

Aug 11 11:30 UK Auctions 0.125% 2058 I/L Gilt

Aug 12 11:30 Germany Eur 4bn Aug 2025 Bund

Aug 13 11:10 Italy Auctions BTPs/CCTeus

Aug 19 11:30 Germany Eur 5bn Sep 2017 Schatz

Aug 19 11:03 Sweden Holds bond auction

Aug 20 10:30 Spain Auctions Bonos/Obligaciones

Aug 20 11:30 UK Auctions 4.25% 2036 Gilt

Aug 21 17:30 Italy Announces details of CTZ/BTPei on 26 Aug

 

 

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