It is very sad if we realize that the evil English dumped some of their poor
settlers in New Zealand to compete with the German peace missions there and to
end with bloody war to wipe out the original inhabitants. The distance between
Britian and New Zealand can be crosssed by about 30 hours of contineous flight.
Greed was the main driving force for this agression. All that happened 150
years ago only.
Now New Zealand suffers elZhaimer in its identity. It is not Asian, it is not
European, it is not Japanese, yet it lives without mission or vision.
There is one advantage there. They live in pacafic tranqility surrounded by
grass and trees that they can see the world with calm and to state that:
the current global financial crisis is the "biggest destruction of global
wealth the world has ever seen".
Yet it does nothing about it and betting that it may get advantages out of it.
S1000+
http://finance.yahoo.com/news/New-Zealand-Dollar-At-fxcm-14502251.html
A week of bearish fundamental data and a bout of risk aversion would end up
leading the New Zealand dollar to break below the 0.500 price level. The RBNZ
lowered its inflation forecast to 2.3% from 2. 5 as it expects growth and
employment to deteriorate. The central bank lowered its GDP expectations for
the year to 0.1% and predicts the unemployment rate will raise to 6%, the
highest since June 2006.
New Zealand Dollar At Critical Support Level, More Losses Ahead?
Fundamental Outlook For New Zealand Dollar: Bearish
- New Zealand’s Annual Trade Deficit Unexpectedly Narrowed In January to
NZ$5.48 billion on Lower Imports.
- RBNZ Lowered 2-Year Inflation Forecast To 2.3% From 2.7% Due To Falling
Energy Costs And Slowing Growth.
- NAB Business Confidence Fell From -35.0 To -41.2 in February, Which was The
Second Worst On Record.
A week of bearish fundamental data and a bout of risk aversion would end up
leading the New Zealand dollar to break below the 0.500 price level. The RBNZ
lowered its inflation forecast to 2.3% from 2. 5 as it expects growth and
employment to deteriorate. The central bank lowered its GDP expectations for
the year to 0.1% and predicts the unemployment rate will raise to 6%, the
highest since June 2006. Reserve Bank of New Zealand Governor Alan Bollard
said the economy would not escape unscathed in the current financial crisis,
when addressing the 2009 Job Summit in Auckland. Bollard said, "The economy
does have a number of imbalances that cannot go on forever and as a result,
there are challenges ahead."
He would further describe the global financial crisis as the "biggest
destruction of global wealth the world has ever seen". Indeed, the banking
troubles brought on by the crisis in the U.S. and Europe sent traders to the
sidelines as fears grow that the frozen credit markets will lead to a deeper
global recession.
The central bank is expected to lower their official cash rate by 75 bps to
2.75% on March 11th and the lower interest rate expectations may continue to
weigh on the “Kiwi”. The weak currency is actually welcomed by the RBNZ as
Governor Bollard stated “the exchange rate is working for us”, “it is helping
cushion the shocks, it’s helping make us more competitive.” The lower valuation
as helped demand for the country’s exports including milk powder, meat and
aluminum. The only fundamental economic release upcoming is the commodity price
index which declined last month by 4.3%. The indicator isn’t market moving but
another month of falling prices would add to the demand for New Zealand goods.
The New Zealand dollar nearly tested the 2/2 low of 0.4961 which is also being
reinforced by Bollinger band support. We could see the NZD/USD bounce from this
level after its recent decline, but any bullish momentum may be capped by the
20-Day SMA at 0.5149 which has served as staunch resistance. However, given the
expectations of a lower interest rates a break below support leaves the pair
susceptible to a drop to the August 2002 low of 0.4484.-JR
DailyFX provides forex news on the economic reports and political events that
influence the currency market. Learn currency trading with a free practice
account and charts from FXCM.
=======
S1000+
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