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At the Forex currency market the New Zealand Dollar suspended its rise on Monday and is slightly going down. The NZD has reached local highs at the end of last week and is now waiting for the new driver to continue ascending trend.

Forex forecast: MACD indicator for the pair NZD/USD is going up in the positive area and is giving a buy signal. Stochastic Oscillator remains in the overbought zone and maintains a similar signal.

Forex recommendations: in case of breakdown at the level of 0.8320, the pair will go to 0.8330 and 0.8350. Consolidation near current levels is probable.

Judging by volumes of positions, growth of NewZealand Dollar has not yet been completed. However, a new impetus is definitely required for the pair in order to go upward.

Activity index in the service sector of New Zealand fell to 50.6 points (-5.6 points) in December. Trade balance amounted to +NZ$338 billion in December against the level of -NZ$307 billion in November. However, positive factor of the index has already been incorporated into the price. Consumer confidence index ANZ fell to 108.4 points in December against 109.0 points earlier. Therefore, Europe and its problems have a strong impact on Australian economy, as well as on other remote counties; forecasts are too difficult to make.

GDP in New Zealand increased by 0.8% q/q inQ3 (+1.9% y/y) against the forecast of +0.6% on quarterly basis. Significant support to the economy of New Zealand was provided by Rugby Championship which attracted a lot of investment into the country. GDP rose by 0.1% q/q (+1.5%y/y) in Q2 against the level of +0.9% q/q (+1.6% y/y) in Q1. Thus, New Zealand economy is actually in the state of stagnation. GDP had almost stopped growing, but revived later. Most likely the index will be weaker in Q4. At the meeting in the end of January, the Reserve Bank of New Zealand decided to leave interest rate at the minimal level of 2.5% per annum. According to follow-up comments of the regulator this decision is reasonable because world economic risks are still preserved despite internal stability in New Zealand. RBNZ emphasized that inflationary pressure is being steadily contained; however NZD growth negatively affects earnings of exporters. In addition, economy of New Zealand demonstrates signs of weak recovery in the housing market and consumer spending.

According to the report of the Reserve Bank of New Zealand, the regulator is ready to act if conditions, appropriate for his intervention will be created. In case if the slump of 2008 will be repeated, the RBNZ has a number of measures to avoid the slump of economy in the global scale. It is all about the level of liquidity in the banks. The document was submitted to authorities in December; however the contents of it have been made public only last week.

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