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At the Forex currency market the New Zealand Dollar rate moderately goes down on Friday morning; the currency had been resisting general negative sentiments at the market for nearly the whole week, however at the end of the week it failed.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD goes down, giving a sell signal, however volumes are below average. Stochastic Oscillator started to reverse in the neutral zone, giving a sell signal.

Forex recommendations: in case of breakdown at the level of 0.8115, the pair will go to 0.8100 and 0.8080.Macro-economic situation in New Zealand does not have fundamental changes at the end of the week.Consumer confidence index Westpac in New Zealand increased to 112.0 points in Q2 against the level of 97.7 points in Q1.

Consumer confidence ANZ increased to 112.5 points in June against the preliminary level of 103.3 points. In addition, volume of retail sales in New Zealand rose for the first time in the last three quarters in Q1, which is a  good sign of the economic recovery. Thus, indicator increased by 0.9% q/q which agreed with the forecast, excluding inflation.

Earlier, the Reserve Bank of New Zealand decided to keep interest rate unchanged at the minimum of 2.50% per annum, since it is going to continue its work on improvement in economic system. According to the head of the RBNZ, NZD has been overvalued because of high export prices for raw materials, therefore, national currency rate, which has increased over the last two months, has adverse impact on the rebalancing of the economy in New Zealand.

Bollard expressed confidence that decline of the NZD will be gradual because currency intervention will not be able to change the trend. Index of trading conditions in Q1 increased to a 37 - year highs in Q1, demonstrating the growth of 0.9% on quarterly basis (+6.8% y/y), which could be one of the signs of economic recovery in New Zealand, as it reflects changes in prices for exports and imports.

We would like to point that the index is strongly correlated with the index of living standard in the country which is a positive sign. Note that this indicator is strongly correlates with the indicator of the living standards of the country –and it is a positive sign.This week data showed that current account balance amounted to -NZD$0.097 billion in Q1 against the forecast of -NZD$0.900 billion. Note that ratio of the deficit to GDP totaled to -4.3% in Q1 this year against the forecast of -4.4% and the level of -2.3% in Q4 last year. 

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