NZD/USD – New Zealand dollar drops ahead of manufacturing, inflation reports

The New Zealand dollar has posted losses in the Thursday session. In North American trade, NZD/USD is trading at 0.6545, down 0.30% on the day. On the release front, New Zealand will release the Business NZ Manufacturing Index, as well as PPI Output and PPI Input. The U.S. posted strong data, led by unemployment claims, which dropped sharply to 212 thousand. This marked a 4-week low. Housing and manufacturing reports improved in April and beat their forecasts.

The New Zealand dollar has been roughed up in the second quarter, declining 3.9%. The New Zealand economy has been hurt by the global slowdown, which has reduced the demand for New Zealand exports. China is New Zealand’s largest trade partner, with 24.9% of New Zealand exports going to the Asian giant. The ongoing trade war between the U.S. and China has caused a slowdown in the Chinese economy. China posted disappointing numbers this week, as industrial production and retail sales fell sharply in April. Weak global economic conditions and the latest round of tariffs between the U.S. and China have weighed on risk appetite, which has made risk currencies, such as the New Zealand dollar, less attractive to investors.

Gold – More upside to come?

Risk Appetite Improves Awaiting Further Trade Clarity

NZD/USD Fundamentals

Wednesday (May 15)

18:30 New Zealand Business NZ Manufacturing Index 18:45 New Zealand PPI Input 18:45 New Zealand PPI Output

Thursday (May 16)

8:30 US Building Permits. Estimate 1.29M. Actual 1.30M
8:30 US Unemployment Claims. Estimate 220K. Actual 212K
8:30 US Philly Fed Manufacturing Index. Estimate 10.0. Actual 16.6
8:30 US Housing Starts. Estimate 1.21M. Actual 1.24M 10:30 US Natural Gas Storage. Estimate 105B 12:15 US FOMC Member Brainard Speaks

Friday (May 17)

10:00 US Preliminary UoM Consumer Sentiment. Estimate 97.8

*All release times are DST

*Key events are in bold

NZD/USD for Thursday, May 16, 2019

NZD/USD May 16 at 12:40 DST

Open: 0.6564 Low: 0.6582 High: 0.6545 Close: 0.6545

NZD/USD Technical

S3 S2 S1 R1 R2 R3
0.6348 0.6424 0.6539 0.6607 0.6699 0.6793

NZD/USD posted small losses in the Asian session. The pair posted considerable gains in European trade but then retracted. NZD/USD continues to lose ground in the North American session

0.6539 is under pressure in support 0.6607 is the next resistance line Current range: 0.6539 to 0.6607

Further levels in both directions:

Below: 0.6539, 0.6424 and 0.6348 Above: 0.6607, 0.6699, and 0.6793

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher joined OANDA in 2012 as a Currency Analyst. Kenny writes a daily column about current economic and political developments affecting the major currency pairs, with a focus on fundamental analysis. Kenny began his career in forex at Bendix Foreign Exchange in Toronto, where he worked as a Corporate Account Manager for over seven years.

Kenny Fisher

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