Forex News: New Zealand Dollar Steady Despite Lower Business Confidence
The Takeaway: New Zealand ANZ Business Confidence declines in March-> Strong US data and risk appetite provide support for the New Zealand dollar -> New Zealand dollar holds steady
Australia and New Zealand (ANZ) Business Confidence declined slightly from 39.4in February to 34.6 in March. Meanwhile, ANZ Activity Outlook came in at 32.4, lower than 37.6 in in February.
This report, combined with the better-than-expected trade surpluses released yesterday and growth figures, suggest that the positive sentiment has not yet reflected in business owners’ confidence. Given the overall upbeat economic releases, the Reserve Bank of New Zealand (RBNZ) is unlikely to cut rate for the next twelve months. However, Governor Graeme Wheeler stated in a press release last week that the overvalued New Zealand dollar hurts export and import competing companies.
Prior to the release, the New Zealand dollar rose to a 1-month high against the dollar due to risk appetite demand and strong US data. Against the firm dollar, the report has limited effect on the NZD/USD and the currency pair is trading at 0.83925, potentially testing higher to the 0.8400 mark.
NZD/USD 1 Minute Chart
Chart Created by Robin Leung using Marketscope 2.0
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