2 Jul 2015
NZD/USD sits at fresh 5-yr lows near 0.6700
FXStreet (Mumbai) - The New Zealand dollar extends its run of losses for a third day versus its American counterpart in the mid-Asian trades, now lifting NZD/USD from fresh five year lows hit below 0.67 handle. The Kiwi extends slide on falling dairy prices confirmed by the Global Dairy Price Index on Wednesday.
NZD/USD drops to lowest levels since June 2010
Currently, the NZD/USD pair -0.42% lower to trade at 0.6708, recovering from a dip to 0.6694 - a new multi-year low. NZD/USD continues its downward spiral as traders increase bets of another RBNZ rate cut at its next policy meeting after dairy prices fell for the last 8 auctions, with Wednesday’s release showing a further fall to 2276. New Zealand's economy is highly dependent on milk exports.
RBNZ Governor Graeme Wheeler said on June 11 when lowering the cash rate, "the weaker prospects for dairy prices and the recent rises in petrol prices will slow income and demand growth and increase the risk that the return of inflation to the mid-point would be delayed."
Moreover, the latest streak of discouraging NZ fundamentals also continues to weigh on the OZ currency. Tuesday’s business confidence survey and building consents data added to the case for further policy easing.
In the day ahead, markets now look forward to a batch of US economic data including the crucial Non-farm payrolls which may set further tone for US dollar moves.
NZD/USD Levels to consider
To the upside, the next resistance is located at 0.6750 levels and above which it could extend gains 0.6811 (July 1 High) levels. To the downside immediate support might be located at 0.6694 (Today’s Low) below that at 0.6670 levels.
NZD/USD drops to lowest levels since June 2010
Currently, the NZD/USD pair -0.42% lower to trade at 0.6708, recovering from a dip to 0.6694 - a new multi-year low. NZD/USD continues its downward spiral as traders increase bets of another RBNZ rate cut at its next policy meeting after dairy prices fell for the last 8 auctions, with Wednesday’s release showing a further fall to 2276. New Zealand's economy is highly dependent on milk exports.
RBNZ Governor Graeme Wheeler said on June 11 when lowering the cash rate, "the weaker prospects for dairy prices and the recent rises in petrol prices will slow income and demand growth and increase the risk that the return of inflation to the mid-point would be delayed."
Moreover, the latest streak of discouraging NZ fundamentals also continues to weigh on the OZ currency. Tuesday’s business confidence survey and building consents data added to the case for further policy easing.
In the day ahead, markets now look forward to a batch of US economic data including the crucial Non-farm payrolls which may set further tone for US dollar moves.
NZD/USD Levels to consider
To the upside, the next resistance is located at 0.6750 levels and above which it could extend gains 0.6811 (July 1 High) levels. To the downside immediate support might be located at 0.6694 (Today’s Low) below that at 0.6670 levels.