This evening there will be a Retail Sales data release for Q1, no doubt if they are reported negative there could be a small amount of movement against the NZD. The NZD as of late has lost most of its major gains moving back up to the 2.10 region.
The recent increase in the rate from the 2.04 region all the way to 2.14 last week has indicated that it was likely the NZD was overvalued and the inevitable fall out has taken place. This has most likely come as welcome relief for the Reserve Bank of New Zealand who recently cut interest rates to make sure the value didn’t increase further. No doubt had the initial cut of 0.25% not caused the downward movement they could have been looking at having to cut interest rates once more.
Next week is quite a busy week for the NZD. On Tuesday there will be a RBNZ inflation expectations release which will give the market an idea of what to expect in the next year. Wednesday will see a speech from the banks Governor Graeme Wheeler which will give an indication into the Monetary Policy Committee’s thoughts into the future of the interest rate.
If you would like to find out further information with regards to my NZD predictions, please feel free to send me an email at [email protected]