Daily Economic Commentary: New Zealand

“I can get used to this!” said the Kiwi as it hung above the .8600 handle against the Greenback. Despite weak trade balance data, the Kiwi was able to trade comfortably in the area of its new all-time highs. Can it keep this up?

You wouldn’t be able to tell from the way the Kiwi has been trading that New Zealand’s trade surplus dropped from 552 million NZD to 230 million NZD last month, falling short of expectations for a 391 million NZD surplus.

Not the best data for June, but there is a silver lining to all of this. Overall, exports rose 4.5% last quarter, with dairy and meat products leading the way.

As an export-dependent country, New Zealand will be keeping a close eye on its bread-winning industry, especially now that the Kiwi is trading at new all-time highs. That being said, expect the RBNZ to take into consideration yesterday’s results when it makes its rate decision tomorrow. In the meantime, keep risk sentiment in check, fellas!

Ain’t no thang but a Kiwi wing! For the 6th consecutive day, NZD/USD closed higher, as the pair closed another 50 pips higher at .8716. Is there no stopping the mighty Kiwi?

Later today, the Reserve Bank of New Zealand will be releasing its interest rate decision. No rate change is expected, but it’d be best to stay on your toes and listen to the accompanying statement. It’ll be interesting to see what RBNZ Governor Alan Bollard has to say about the state of the economy and the strong rise of the Kiwi. Tune in at 9:00 pm GMT to find out what will be said!

A good start, but a poor finish was what we got from the Kiwi yesterday! A strong reading from the NBNZ business confidence lifted it up in the Tokyo session, but NZD/USD eventually gave up all of its gains late in the New York session. What can we expect today?

After the NBNZ business confidence report upgraded its reading from 46.5 to 47.6, the Kiwi started marching up the charts. As a matter of fact, it tapped a new all-time high at .8767 before it turned down and erased all its intraday gains. Apparently, the perkiness of New Zealand business sentiment wasn’t enough to sustain the Kiwi’s rally, even though spirits were up in all sectors of the economy.

It should come as no surprise then that the RBNZ sounded really hawkish in its rate statement a few hours ago. RBNZ Governor Bollard and his men believe that the economy is picking up steam, and that it may actually be strong enough to warrant a rate hike soon. New Zealand has certainly come a long way from its rate-cutting days back in March!

So far, this has been great news for Kiwi bulls, who have eagerly been buying Kiwis since the rate statement was made. However, the bullish move isn’t as strong as you’d expect, probably because Bollard expressed concern about the Kiwi’s strength and its effect on the economy.

The only report due today is the monthly building permits release, which posted a 2.2% increase in May. Should this print a strong rise, it would be the second straight month that growth in building approvals accelerated. Who knows, maybe that’s what buyers are waiting to see before they take the Kiwi to new all-time highs!

Oooohhhhh baby, it’s starting to look like the Kiwi has run out of steam! For the second day in a row, NZD/USD failed to sail higher, as it closed right at its opening price of .8692. Is this the top for the Kiwi?

If you ask me, I ain’t quite ready to call a top on the Kiwi. The pair may fall in the coming days as traders book some profits, but there’s a good chance that they will also see any dips as buying opportunities. Of course, everything might change over the next couple of days, but for now, the Kiwi is STRONG!

Late yesterday, building consents data showed that approvals fell by 1.4% in June, after they rose by 2.4% in May. This didn’t have too much of an effect on Kiwi trading, but this is something I’ll be monitoring in the coming months.

No biggies on the docket, but it’d be best if you kept an eye out for shifts in risk sentiment. As my momma always used to say, things can change on a dime, so be careful out there!

“Eat my dust, dollar!” The Kiwi smoked the dollar’s butt on Friday when NZD/USD bounced off support at .8650 and rallied to close just a few pips below its all-time highs at .8789 with a 95-pip win.

No economic reports were released from New Zealand but the pessimism over the U.S. debt ceiling seemed enough for investors to buy Kiwis in exchange for ‘em Greenbacks.

Our forex calendar is still blank data for the Kiwi today so keep tabs on market sentiment, ayt?

Just like its comdoll siblings, the New Zealand dollar started the week off on a weaker note, as risk aversion took over the markets. NZD/USD suffered a 29 pip loss to close at .8766. Could this finally be the week where the Kiwi gives back its ridiculous gains?

No biggies on the docket today, but that don’t mean we won’t see any wild moves on the Kiwi. Watch out for shifts in risk sentiment, as it seems like that could be dominant market theme for this week.

Whoa! Is it open season for the Kiwi?? It looks like bears hunted down the currency in yesterday’s trading as NZD/USDplunged from its intraday high of .8785 all the way down to its closing price of .8670.

Although New Zealand’s labor cost index for the second quarter came in as expected at 0.5%, continued concerns about the U.S. economy and Europe’s sovereign crisis took a toll on higher-yielding currencies.

But perhaps the employment report, due later at 10:45 pm GMT, will be able spark enough good vibes for the Kiwi. Watch out so a figure better than the expected 0.1% uptick in employment change. Meanwhile, also keep in mind that the unemployment rate is seen to come in at 6.5%.

While other major currencies basked in the glory of volatility, the Kiwi simply traded in a relatively tight range yesterday due to the absence of an economic catalyst. NZD/USD just bounced around its intraday session highs and lows and ended the day with a small 46-pip loss.

Earlier today, however, the Kiwi experienced a huge drop due to a disappointing first quarter labor report. The report showed that there was no increase in the number of people employed and the unemployment rate did not improve and stayed at the 6.5% level.

New Zealand’s forex calendar has nothing more in store for us today, so the bearish sentiment towards the Kiwi due to the jobs report could remain all day. In any case, still watch out for shifts in market sentiment! You never know when the market will turn bullish!

And that’s four days in a row! The Kiwi sank even deeper in the charts in yesterday’s trading, closing at its three-week low of .8358 after opening the day at .8620.

As usual, risk aversion was the culprit of the Kiwi’s demise. Talks of default in the euro zone had investors fleeing higher-yielding currencies.

It also didn’t help that New Zealand’s employment change report for Q2 2011 didn’t impress markets. According to Statistics New Zealand, there wasn’t any change in the number of employed people. It was what markets had expected but the reading for the first quarter was revised down to 1.3% after being initially reported at 1.4%.

Our forex calendar is blank for reports for the Kiwi today, so make sure you get a good feel of market sentiment first before pulling the trigger, ayt? Good luck! Remember that the currency usually rallies when risk appetite picks up.

Thanks to the combination of the U.S. debt graduate and risk appetite on the better-than-expected non-farm payrolls, NZD/USD was able to bounce back higher and hold above the .8350 level.

Just in case you have been living under a rock, over the weekend, the U.S.'s prized AAA rating was stripped off by the S&P in response to President Obama and lawmakers agreement to raise the debt ceiling. This caused traders to sell-off the dollar in favor of other currencies.

No red flags on New Zealand’s economic calendar this week but don’t expect the Kiwi to just trade sideways! There are a lot of data releases from the U.S. that could indirectly affect the Kiwi, so you better be prepared!

My, how the mighty has fallen! After rising like rock star against the Greenback for the past couple of weeks, NZD/USD started the week by plunging 170 pips to .8249. Talk about starting off on the wrong side of the charts!

Though no economic reports were released from New Zealand yesterday, the currency bears had a field day selling high-yielding currencies like the comdolls. As it turned out, the S&P downgraded a bunch of other assets yesterday, which sparked a selloff in high-risk-related assets.

Though risk aversion is the most likely push the Kiwi again today, you could also watch out for the REINZ house price index coming out some time today. The report clocked in a 1.3% gain in June, so a lower growth figure might inspire more Kiwi selling over the next few sessions.

Stay sharp in your trades, kiddos!

After its huge losses on Monday, the Kiwi decided to step up its game and take advantage of the very bearish FOMC statement yesterday. NZD/USD closed the U.S. trading session at .8283, a solid 132 pips higher from where it was at the beginning of the day.

The FOMC statement had some pretty gloomy statements about the economy. For one, the statement revealed growth of the U.S. this year was far less than what the Fed had initially expected. In addition, some economic indicators show that the overall labor situation has actually deteriorated.

The biggest reason behind the dollar’s fall was the Fed’s commitment to keep rates at “exceptionally low” levels at least through the second half of 20123.

No data coming out of New Zealand’s economic cupboard today so don’t hold your breath for any strong moves like yesterday. We could actually see the Kiwi simply consolidate and trade sideways today!

KABOOM! After enjoying a slight rally against the Greenback yesterday, the Kiwi was sent straight back down in the charts as risk aversion once again plagued the high-yielding currencies. NZD/USD dropped by a solid 302 pips, ending the day at .8081.

Aside from risk aversion in markets, the worse-than-expected reports from New Zealand might have also spurred on the Kiwi bears. New Zealand’s business manufacturing index clocked in at a 53.2 reading in July from its 54.3 figure in June, while the REINZ house price index declined by 0.6% after climbing by 1.3% in June.

Will the currency bears continue to munch on the Kiwi today? No reports will be released from New Zealand, but stay sharp for any interesting turns in risk sentiment!

No back-to-back losses here! The Kiwi chalked up nice gains yesterday as improved risk appetite helped it erase some of its losses from Wednesday. NZD/USD joined the risk rally, climbing up 219 pips to close at .8306.

With risk appetite backing its rise, there was no stopping the Kiwi from marching up the charts! At first it looked as though the Kiwi would have another bad day as New Zealand data came in slightly disappointing early in the morning.

As I had mentioned yesterday, the Business NZ manufacturing index downgraded its reading from 54.3 to 53.2 last month. Likewise, the REINZ HPI report came in disappointingly as it showed a 0.6% decline in house prices, a very modest figure compared to the previous month’s 1.3% uptick.

Today, I suggest you monitor risk sentiment closely. It was the main market-mover yesterday, and it will probably continue to dictate price action today. That being said, stay on your toes, kids!

Score another one for the comdoll! After slipping to a low at .8179, NZD/USD bounced by 145 pips and actually capped the week at .8324! There were no news reports out from New Zealand, so what’s up with the big move?

Nothing much, really. Apparently, the Kiwi was one of the high-yielding currencies that benefited from the sure in risk appetite in markets. As Forex Gump mentioned last weekend, there were plenty of news reports from the other major economies that inspired the currency bulls to take on high-yielding currencies like the comdolls.

Will the Kiwi stay on the fast track to its previous highs on the charts, or will it pare back some of its gains this week? Only the quarterly PPI report due tomorrow at 10:45 pm GMT, visitor arrivals data on Thursday around the same time, and the credit card spending report on Friday at 3:00 pm GMT are on New Zealand’s deck this week, so you might want to keep an eye out for risk sentiment changes!

Good luck in your trades this week, kids! Follow your trading plan!

Tough luck, huh? The Kiwi tried to make headway against the Greenback yesterday, with NZD/USD topping out at .8389. However, the pair was unable to hold on to its gains and closed 7 pips down from its .8332 open price.

New Zealand didn’t release any economic data yesterday, which was probably why NZD/USD had a tough time staying afloat. Today, the PPI input and PPI output figures are set for release at 10:45 pm GMT. This could show that producer input prices were up by 1.2% during the second quarter of this year while producer output prices increased by 0.8%. If the actual figures came in line with expectations, those would be weaker than the 2.2% PPI input increase and the 1.7% PPI output rise for the first quarter of 2011.

Keep an eye out for those reports because stronger than expected results could push the RBNZ to tighten monetary policy and keep inflation contained. Don’t forget to keep close tabs on risk sentiment as well!

What a scrappy little fighter this Kiwi is! In spite of the fact that it had no economic data to back it up, it managed to score a 37-pip gain over the Greenback as NZD/USD climbed to .8360.

But it doesn’t look like it’ll get the same results today… at least not as far as the PPI input report is concerned! The report for Q2 2011 showed that PPI eased from 2.2% to just 0.9%, falling short of the forecasted 1.2% figure. So far, the markets have been acting accordingly, selling off the Kiwi at a slow but steady pace.

It looks like that’ll be the main market driver, at least for the next few hours. But you know as well as I do that these markets can shift directions in the blink of an eye, so stay sharp and keep risk sentiment in check! Remember, risk appetite is the Kiwi’s friend!

Despite the lack of economic data from New Zealand, the Kiwi crept higher against the U.S. dollar yesterday as risk appetite improved. NZD/USD reached a high of .8426 before ending the day at .8375. Can it keep up its winning streak?

Unfortunately, the Kiwi can’t rely on economic data from New Zealand today because there aren’t any top-tier reports due! The only item in its agenda is the visitor arrivals report, set for release 10:45 pm GMT. The report printed a 5.1% drop in visitor arrivals for June but could show a rebound for July. A positive figure would most likely be positive for the Kiwi as well.

Other than that, expect NZD/USD to be swayed by risk sentiment today. Stay on your toes, people!

The New Zealand dollar went down, and boy, did it go down hard! NZD/USD practically erased one week’s worth of rallying as the pair dove 134 pips down to .8210. That’s a 2% drop against the Greenback! And the selloff doesn’t look like it’s over yet, either!

The usual culprit was behind the Kiwi’s fall - risk aversion! Once again, risk sentiment turned sour as concerns about global growth escalated and took its toll on equities and commodities. And we all know the Kiwi is called a comdoll for a reason. Where commodities go, you can expect it to follow!

So far, the bearish momentum on NZD/USD is carrying the pair lower. Considering the strength of yesterday’s move and the fact that New Zealand has no big reports to support the Kiwi, the pair may just continue falling until the weekend arrives. Still, it’s best to trade according to risk sentiment as it was clearly the main market driver yesterday. Be safe out there, kids! Don’t forget your stops!

Make that two in a row! After it looked like the Kiwi was gonna stage a comeback, it sank late last Friday to post a 29-pip loss and closed at .8181.

This week, we’ve got two red flags coming up for New Zealand on our economic calendar.

First, inflation expectations are coming out early tomorrow at 3:00 am GMT. Last quarter, inflation expectations were pegged at 3.0%. Keep an eye out for the release tomorrow, as a figure above 3.0% could give the RBNZ reason to reconsider raising rates sooner rather later.

On Wednesday, quarterly retail sales data will be available. Word is that sales growth was at 0.6% for the 2[SUP]nd[/SUP] quarter, a slight dip from the 1[SUP]st[/SUP] quarter’s 0.9% figure. A stronger than expected figure could boost the Kiwi and allow it to recapture some of its losses from late last week.