- The NZD/USD remains in profits about 0.5820 in the middle of the strength of the New Zealand dollar.
- China’s monetary stimulus pack has raised the attractiveness of the NZD.
- The Fed is almost sure to keep interest rates in its current range on Wednesday.
The NZD/USD PAR maintains significant profits on Monday about 0.5820 at European negotiation hours on Tuesday. The Kiwi torque exhibits strength since the attractiveness of the New Zealand dollar (NZD) has been strengthened after China announced a new monetary stimulus to boost consumption and encourage economic growth.
On Sunday, the Chinese ministry announced an integral “special action plan” to increase economic growth. The Ministry reported that the plan focuses on increasing residents income, reducing financial loads and improving the consumption environment, according to Reuters.
The acceleration signals in China’s economic growth are positive for the New Zealand dollar, knowing that the New Zealand economy (NZ) depends largely on exports to China.
Meanwhile, the US dollar (USD) falls close to the minimum of five months before the decision on interest rates of the Federal Reserve (FED) on Wednesday. It is widely anticipated that the Fed maintains stable interest rates in the range of 4.25%-4.50%, since officials have been guiding that monetary policy adjustments are unfavorable amid the uncertainty about the economic perspectives of the United States (USA) under the leadership of President Donald Trump.
The NZD/USD breaks strongly above the 0.5800 key resistance drawn from the maximum of January 24. The asset remains above the exponential (EMA) mobile average of 20 days about 0.5720, which suggests that the short -term trend is upward.
The 14 -day relative force (RSI) index breaks above 60.00. A new bullish impulse would be activated if the RSI is maintained above that level.
More increases would appear if the asset breaks the fibonacci setback of 38.2% of 0.5850 layout from the maximum of September 30 to the minimum of February 3 to the round level resistance of 0.5900 and the maximum of November 29, 0.5930.
On the other hand, the Kiwi torque could decline near the round level supports of 0.5400 and 0.5300 if it breaks below the minimum of 13 years of 0.5470.
NZD/USD DIARY GRAPH
New Zealand Faqs dollar
The New Zealand dollar (NZD), also known as Kiwi, is a well -known currency among investors. Its value is largely determined by the health of the neozyous economy and the policy of the country’s central bank. However, there are some peculiarities that can also make the NZD move. The evolution of the Chinese economy tends to move Kiwi because China is the largest commercial partner in New Zealand. The bad news for the Chinese economy is probably translated into less neozyous exports to the country, which will affect the economy and, therefore, its currency. Another factor that moves the NZD is the prices of dairy products, since the dairy industry is the main export of New Zealand. The high prices of dairy products boost export income, contributing positively to the economy and, therefore, to the NZD.
The New Zealand Reserve Bank (RBNZ) aspires to reach and maintain an inflation rate between 1% and 3% in the medium term, with the aim of keeping it near the midpoint of 2%. To do this, the Bank sets an adequate level of interest rates. When inflation is too high, RBNZ rises interest rates to cool the economy, but the measure will also raise bond performance, increasing the attractiveness of investors to invest in the country and thus boosting the NZD. On the contrary, lower interest rates tend to weaken the NZD. The differential type of types, or how they are or is expected to be the types in New Zealand compared to those set by the Federal Reserve of the US, can also play a key role in the NZD/USD movement.
The publication of macroeconomic data in New Zealand is key to evaluating the status of the economy and can influence the valuation of the New Zealand dollar (NZD). A strong economy, based on high economic growth, low unemployment and high confidence is good for NZD. High economic growth attracts foreign investment and can encourage the New Zealand reserve bank to increase interest rates, if this economic strength is accompanied by high inflation. On the contrary, if the economic data is weak, the NZD is likely to depreciate.
The New Zealand dollar (NZD) tends to strengthen during periods of appetite for risk, or when investors perceive that the general market risks are low and are optimistic about growth. This usually translates into more favorable perspectives for raw materials and the so -called “raw material currencies”, such as Kiwi. On the contrary, the NZD tends to weaken in times of turbulence in markets or economic uncertainty, since investors tend to sell the most risky assets and flee the most stable shelters.
Source: Fx Street
I am Joshua Winder, a senior-level journalist and editor at World Stock Market. I specialize in covering news related to the stock market and economic trends. With more than 8 years of experience in this field, I have become an expert in financial reporting.
