NZD/USD Fundamental Analysis – November 13, 2015 – Forecast

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Published: Nov 12, 2015, 04:59 UTC

Analysis and Recommendation: The NZD/USD drifted down 7 points to 0.6552 after Business PMI printed lower than last month due to the drop in production

Analysis and Recommendation:

The NZD/USD drifted down 7 points to 0.6552 after Business PMI printed lower than last month due to the drop in production and imports in China. Lackluster Chinese data over the past days has weighed heavily on the kiwi. The only bright spot was a jump in retail sales which helped the commodity currency from falling farther.

The BNZ-BusinessNZ performance of manufacturing index fell to a seasonally adjusted 53.3 last month, from 55 in September, marking the lowest level since May. A reading of 50 separates expansion from contraction.

The manufacturing sector has been expanding since October 2012. The latest monthly reading shows that while four of the five sub-sectors of the index declined, all but finished stocks remain in expansion. The PMI showed the measure of new orders declined to 55.9 from 57.4 in September, production fell to 53.1 from 57.5, and deliveries slipped to 52.5 from 55.2, and finished stocks dropped to 49.2 from 52.4. Meanwhile, employment advanced to 52.4 from 51.1.

The proportion of positive comments increased to 61.8 percent in October from 58.7 percent in September, with many citing increased offshore orders and new customers.

China’s data dump of industrial production, urban fixed asset investment and retail sales numbers has followed a predictable pattern in October with weakness in industrial data largely offset by strength in consumer spending. From a year earlier industrial production increased by 5.6%, missing expectations for growth of 5.8%. It was also below the 5.7% level seen in September.

Trade data for October also disappointed with both exports and imports falling at a faster pace in the 12 months to October than what the markets had anticipated.

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
NZD	Business NZ PMI (Oct)	53.3		55.4
GBP	RICS House Price Balance (Oct)	49%	45%	44%
AUD	Employment Change (Oct)	58.6K	15.0K	-0.8K
AUD	Full Employment Change (Oct)	40.0K		-10.4K
AUD	Unemployment Rate (Oct)	5.9%	6.2%	6.2%

Upcoming Economic Events that you should be monitoring:

Friday, November 13, 2015

Cur.	Event	Actual	Forecast	Previous
JPY	Industrial Production (MoM) (Sep)		1.0%	1.0%
JPY	Tertiary Industry Activity Index		0.2%	0.1%
EUR	German GDP (YoY) (Q3)		1.8%	1.6%
EUR	German GDP (QoQ) (Q3)		0.3%	0.4%
EUR	GDP (YoY) (Q3)		1.7%	1.5%
EUR	GDP (QoQ) (Q3)		0.4%	0.4%
EUR	Trade Balance (Sep)		18.2B	11.2B
USD	Core PPI (MoM) (Oct)		0.1%	-0.3%
USD	Core Retail Sales (MoM) (Oct)		0.4%	-0.3%
USD	PPI (MoM) (Oct)		0.2%	-0.5%
USD	Retail Sales (MoM) (Oct)		0.3%	0.1%
USD	Business Inventories (MoM) (Sep)		0.1%	0.0%
USD	Michigan Consumer Expectations		84.0	82.1
USD	Michigan Consumer Sentiment (Nov)		91.5	90.0
USD	FOMC Member Mester Speaks
USD	Baker Hughes U.S. Rig Count			572