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At the Forex currency market the New Zealand Dollar rate continues to strengthen on Wednesday.

Forex forecast: MACD indicator is in the positive area for the pair NZD/USD and is rising, maintaining a buy signal. Stochastic Oscillator stays in the overbought zone today, giving the same signal.

Forex recommendations: in case of current market sentiments’ strengthening and breakup at the level of 0.7725 the pair will move to the previous high at 0.7733 and then – to 0.7750.

According to New Zealand monetary officials, the regulator will not have to reduce the key interest rate because of economic stabilization.
In other respects the situation in the national economy remains unchanged.

As it became known the daybefore, the 1q level of NBNZ Business Confidence in New Zealand, according to NIESR, decreased by 27% against the 4q level of +8 points.

Thereby the first 1q data is being published, yet rather weak. Still kiwi ignores the statistics. March data is not impressive: the level of NBNZ business outlook in New Zealand declined to -8.7 points in March against the level of 34.5 points in February. It is difficult to judge on the reasons of such a rollback, and one should wait for the next data to judge on the trend.

Export levels increased by 17% y/y in February, import – by 23% y/y to the level of NZ$3.86 bln. Export accounts for about 30% of NZ GDP and an increase in it will have a positive effect on the national economy.

Balance of current account in New Zealand decreased to -NZ$3.5 billion against the value of -NZ$1.77 billion in QIII. The balance is most likely decreased due to the seasonal factors and we surely can see improvement in the situation.

Data released on trade balance last week turned out to be positive for the first time in 8 months. The main catalysts for this were high commodity prices and an increase in export levels of wood and dried milk.

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