New Zealand Dollar surged after RBNZ rate decision, as the central bank didn’t sound particularly concerned about recent surge in exchange rate. “The gains from higher export commodity prices have been somewhat offset by the stronger New Zealand dollar” was the only thing that mentioned.
In the key baseline scenario variables, RBNZ raised the trade weighed index of NZD significantly from 71.5 to 74.9, throughout the forecast horizon. CPI inflation variables were raised at the same time while GDP growth variables were kept largely unchanged. The table suggests that NZD’s strength hasn’t altered RBNZ’s outlook much, and the central bank should still be comfortable with it.
NZD/USD surges to as high as 0.7382 so far today. Outlook will stay bullish as long a s0.7280 support holds. Current up trend from 0.5469 is on track to 61.8% projection of 0.6589 to 0.7314 from 0.7156 at 07604.
NZD/JPY also extends recent rally and hits as high as 77.81 so far. Daily MACD suggests that it’s now in re-acceleration mode. Outlook will remain bullish as long as 76.77 support holds. Up trend from 59.49 should target 161.8% projection of 63.45 to 71.66 from 68.86 at 82.14 next.
