NZD/USD Fundamental Analysis October 17, 2014 Forecast

Analysis and Recommendation:

The NZD/USD added 4 points against the weaker US dollar after NZ business PMI printed above forecast. The kiwi climbed to trade at 0.7990. The kiwi touched a three-week high even amid concerns about global economic growth, and as dairy product prices rose in the latest auction. The dollar index, which measures the greenback against a basket of currencies, dropped to its lowest in almost a month after weaker-than-expected US retail sales and producer prices data revived concerns about growth in the world’s largest economy. That added to worries about global economic growth which were heightened after a report showed Chinese consumer prices slowed more than expected in September to a nearly five-year low.  Dairy product prices rose in Fonterra Cooperative Group’s fortnightly GlobalDairyTrade auction, recovering from the lowest level in five years, as fewer products was offered for sale.

While the rise in dairy prices is positive for kiwi, it didn’t fully explain the local currency’s gain overnight because demand for New Zealand dairy products would be affected by weaker global growth. The New Zealand dollar was the best performer, rising 1.9 percent to 79.90 cents. GlobalDairyTrade said the average winning price for whole milk powder rose to $2,503 a metric ton from $2,443 at a previous auction. The nation’s Fonterra Cooperative Group Ltd. is the world’s biggest dairy exporter.

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:

Government Bond Auction

Date Time Country Auction

Oct 20 12:00 Belgium OLO Auction

Oct 20 12:00 Slovakia Bond auction (for decision)

Oct 21 10:30 Spain 3 & 9M T-bill auction

Oct 21 11:00 Norway Bond auction

Oct 21 11:00 UK Auctions 2.75% 2024 Gilt

Oct 22 11:30 Germany Eur 2.0bn Aug 2046 Bund auction

Oct 23 11:03 Sweden I/L bond auction

Oct 23 17:00 US Announces 2/5/7Y Note & 2Y FRN auctions on Oct 28/29/30 & 29

Oct 23 17:30 Italy Announces details of BTPei/CTZ auctions on Oct 28

Oct 23 19:00 US 30Y TIPS auction

Oct 24 17:30 Italy Announces details of BOT auction on Oct 29