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NZForex Outlook: NZD slide welcomed

NZForex

Tuesday 18th November 2014

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The NZ dollar's near 10% slide against the US dollar has been welcomed by the government, and Nick Tvedt from NZForex predicts it will remain rangebound for a while.

NZ dollar slide "welcome"
•New Zealand Finance Minister Bill English expressed some satisfaction at the weekend over the nearly 10% slide in NZD/USD in the last three months
•In his view the mid to high 0.70s are "sustainable" levels for the economy

Positive data boosts NZD
•The NZD has had a solid start to the week, rallying 0.5% this morning (Monday) to 0.7955 after stronger than expected retail sales.
•The data printed was the largest rise for Retail Sales since 2012, food and fuel were responsible for the bulk of the increases
•In terms of other influences, the G20 provided no new impetus for prices, and reports that Putin came under fire over MH17 are likely overdone

Influences this week
•Tuesday's key events include the tentatively scheduled GDT Price Index (last -0.3%)
•Wednesday then features PPI Input (0.3%)

NZD stuck in a rut?
•Despite today's rally the NZDUSD remains largely rangebound.
•The psychological 0.8000 level and 21st October’s high at 0.8034 are the next big tests on the upside
•In my view 0.7840 should provide decent support on the downside if seen
•Current spot is 0.7929.


Nick Tvedt is Senior FX Dealer at NZForex, New Zealand's leading international money transfer service and part of The OzForex Group (ASX:OFX). NZForex is a key provider of in depth commentary, forex news and insight as well as expert market analysis.

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