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New Zealand Trade Balance Above Expectations

By Swissquote LtdMarket OverviewMar 26, 2018 11:39
uk.investing.com/analysis/new-zealand-february-trade-balance-above-expectations-200200655
New Zealand Trade Balance Above Expectations
By Swissquote Ltd   |  Mar 26, 2018 11:39
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By Vincent Mivelaz

New Zealand's economy is showing signs of recovery following recent February trade balance data given at NZD 217million (consensus: -100 million) or USD 157 million, the highest rate after NZD -655 million deficit in January. On the downside however, New Zealand 12 months trade balance remains at NZD -3 billion. Exports rose by NZD 4.46 billion (previous: NZD 4.31 billion) while imports increased by NZD 4.24 billion (previous: NZD 4.94 billion).

Royal Bank of New Zealand agreed to implement a second mandate alongside price stability on Monday, consisting of maximum employment, in line with Fed’s existing dual mandate implemented in the 1970s. The mandate will be enshrined in law this year. New Zealand treasuries remain unchanged following the announcement. 2-year and 10-year yields are given at 1.88% (+0.17) and 2.78% (+0.18).

On the forex side, we notice the strong increase of non-commercial long NZD futures positions increasing by 19’626 (previous week: -2’816), amounting to 44% of total open interest contracts, thus signalling traders’ tendency to dump the greenback. The trend might continue into that direction, supposing further weakness from the USD.

Accordingly, we suspect the USD/NZD to head along the 1.37 range.

Disclaimer: While every effort has been made to ensure that the datat quoted and used for the research behind this document is reliable, there is no guarantee that it is correct, and Swissquote Bank and its subsidiaries can accept no liability whatsoever in respect of any errors or omissions, or regarding the accuracy, completeness or reliability of the information contained herein. This document does not constitute a recommendation o sell and/or buy any financial products and is not to be considered as a solicitation and/or an offer to enter into any transaction. This document is a piece of economic research and is not intended to constitute investment advice, nor to solicit dealing in securities or in any other kind of investment.

Although every investment involves some degree of risk, the risk of loss trading off-exchange forex contracts can be substantial. Therefore if you are considering trading in this market, you should be aware of the risks associated with this product so you can make informed decisions prior to investing. The material presented here in not to be construed as trading advice or strategy. Swissquote Bank makes a strong effort to use reliable, expansive information, but we make no representation that it is accurate or complete. In addition, we have no obligation to notify you when opinions or data in this material change. Any prices stated in this report are for information purposes only and do not represent valuations for individual securities or other instruments.

New Zealand Trade Balance Above Expectations
 

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New Zealand Trade Balance Above Expectations

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