NZD/USD Fundamental Analysis October 28, 2014 Forecast

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Updated: Aug 25, 2015, 03:00 UTC

Analysis and Recommendation: The NZD/USD gained 23 points to trade at 0.7878 with the markets closed for the local holiday. The US dollar eased this

NZD/USD Fundamental Analysis October 28, 2014 Forecast

Analysis and Recommendation:

The NZD/USD gained 23 points to trade at 0.7878 with the markets closed for the local holiday. The US dollar eased this morning ahead of this week’s FOMC meeting due to start tomorrow. New Zealand’s inflation was expected to contract from 1.6% to 1.2% on Wednesday; however, the actual figure showed a bigger loss, sinking to 1.0%. The Reserve Bank of New Zealand hiked interest rates four times in quick succession this year but with such a dip in inflationary levels, the central bank is unlikely to alter the benchmark rate for some time.

In the present economic climate, the price of dairy commodities have been slashed almost in half since February – one factor that damaged the trade balance. Exports fell by 3% in the third quarter while imports rose by 4%. The previous quarter saw exports fall by 7.5%, catalyzed by a drop in milk power, cheese and butter. New Zealand imported aircraft jets totaling $459 million recently which has also helped to extend the trade deficit.

The New Zealand Dollar is in for a volatile period in the week ahead as a hefty dose of domestic fundamental event risk is compounded by high-profile macro-level developments. On the home front, the spotlight is on the RBNZ monetary policy announcement.

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:

Cur.		Event	Actual	Forecast	Previous
	Holiday	New Zealand – Labour Day
USD		Pending Home Sales		0.5%	-1.0%

Upcoming Economic Events that you should be monitoring:

Cur.	Event	Actual	Forecast	Previous
JPY	Retail Sales (YoY) (Sep)		0.6%	1.2%
USD	Core Durable Goods		0.5%	0.4%
USD	Durable Goods Orders		0.6%	-18.4%
USD	S&P/CS HPI Composite		5.8%	6.7%
USD	Consumer Confidence		87.0	86.0