NZD/USD Fundamental Analysis, March 12, 2015 – Forecast

Analysis and Recommendation:

The NZD/USD declined by 29 points to trade at 0.7244 as the US dollar continued to rally. The US Dollar resumed pushing higher in Asian trade, adding as much as 0.4 percent on average against its leading counterparts. Firming interest rate hike expectations appeared to be behind the move. Fed Funds futures rose to hint the FOMC may deliver as many as two increases in the target range for the baseline lending rate by year-end. The Australian and New Zealand Dollars bore the brunt of the greenback’s advance, sinking as much as 0.9 and 1.1 percent respectively.

A sharp increase in the dollar’s strength and lingering concerns about an interest-rate hike sparked a sell-off Tuesday that wiped out the major indexes’ gains for the year.

Analysts said both the extent and the rapid pace of the dollar’s recent rise rattled investors who feared that the dampening effect of a stronger greenback on American exports would interfere with the U.S. recovery.

The New Zealand government posted a small operating surplus in the seven months through January as tax revenue beat expectations, while costs were smaller than anticipated.

The New Zealand dollar fell sharply after government officials said police have been investigating threats to contaminate infant formula and related dairy products with the pest killing poison 1080. The Ministry for Primary Industries has tested more than 40,000 raw milk and product samples since November, when Federated Farmers first received anonymous threats in the mail, which included infant formula laced with the poison. That letter threatened to contaminate dairy formulas if the use of 1080 wasn’t abandoned by the end of this month. Trading was briefly halted in the shares of dairy companies and on the NZX Dairy Futures and Options market. No contaminated product has been found.

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 actual vs. forecast:

 

Upcoming Economic Events that you should be monitoring:

Thursday, March 12, 2015

Government Bond Auctions

Date Time Country

Mar 12 10:30 Spain Auctions 1.4% Jan 2020 Bono, plus 5.85% Jan 2022 & 1.60%

Mar 12 11:00 Ireland Eur 1bn 2% 30 year (Feb 2045) bond

Mar 12 11:10 Italy Auctions BTPs/CCTeus

Mar 12 11:30 UK Auctions I/L conventional Gilt

Mar 12 17:00 US Announces 10-yr TIPS auction on Mar 19

Mar 12 19:00 US Usd 13bn 30-yr Bonds

Mar 18 11:30 Germany Eur 4bn Feb 2025 Bund

Mar 18 16:30 Sweden Details bond sale on 25 Mar

Mar 19 11:10 France Auctions BTANs

Mar 19 12:10 France Auctions OATi

Mar 19 11:10 Sweden Holds inflation-linked bond auction

Mar 19 11:30 UK Auctions conventional Gilt

Mar 19 17:00 US Announces 2-yr FRN, plus 2/5/7 yr Notes

Mar 19 19:00 US Auctions 10-yr TIPS