NZD/USD – Limited Movement Ahead of Fed Minutes

NZD/USD continues to have a quiet week, as the pair trades at 0.6460 in the North American session. In economic news, the New Zealand Global Dairy Trade Price Index disappointed with a sharp decline of 7.9%. In the US, Building Permits improved to 1.15 million, matching the forecast. The shift now focuses to the Federal Reserve, which releases the minutes of its October policy meeting later in the day. The minutes could provide the markets with some insight as to Fed policymakers’ views regarding a rate move in December.

The guessing game continues as to whether the Federal Reserve will kick off a series of rate hikes in December, so the markets will be carefully combing through the Fed minutes, which will be released later on Wednesday. Market expectations have risen to 66% that the Fed will make a move next month. The last time the Fed raised interest rates was in June 2006, so such a move is sure to have a significant effect on the global currency markets. With the US economy close to full employment and many economic indicators pointing upwards, one of the last pieces in the puzzle is inflation. Last week’s PPI was awful, posting a second straight decline. On Tuesday, CPI and Core CPI posted small gains of 0.2%, matching the forecast. Are these lukewarm readings enough to convince the Fed to make a move in December? The Fed has said that inflation levels are an important factor in determining its decision in December, but with US inflation stuck at low levels, it remains a guessing game as to whether the Fed will press the rate trigger at its next policy meeting.

In New Zealand, the Global Dairy Trade Price Index, a leading indicator of the nation’s trade balance, continues to struggle. The indicator posted a third straight decline, with an unimpressive reading of -7.9%. NZD/USD shrugged off this weak release, but the pair remains mired at 5-week lows. On Wednesday, we’ll get a look at PPI Input, an important inflation gauge.

The US economy has certainly improved, but the manufacturing sector continues to lag behind. Earlier this week, the Empire State Manufacturing Index posted its fourth straight decline, underlining worsening conditions in the manufacturing sector. In November, the indicator came in at -10.7 points, weaker than the forecast of -5.3 points. On Thursday, we’ll get another look at manufacturing data, with the release of the Philly Fed Manufacturing Index. This indicator has also struggled, posting two straight declines. The markets are expecting some improvement in the November report, with an estimate of 0.1 points.

NZD/USD Fundamentals

Tuesday (Nov. 17)

  • 14:07 New Zealand Global Dairy Trade Price Index. Actual -7.9%

Wednesday (Nov. 18)

  • 13:00 US FOMC Member William Dudley Speaks
  • 13:30 US Building Permits. Estimate 1.15M. Actual 1.15M
  • 13:30 US Housing Starts. Estimate 1.16M. Actual 1.06M
  • 15:30 US Crude Oil Inventories. Estimate 2.0M.
  • 19:00 US FOMC Meeting Minutes
  • 21:45 New Zealand PPI Input
  • 21:45 New Zealand PPI Output

Upcoming Key Events

Thursday (Nov. 19)

  • 13:30 US Unemployment Claims. Estimate 272K
  • 15:00 US Philly Fed Manufacturing Index. Estimate 0.1 points

*Key releases are highlighted in bold

*All release times are GMT


NZD/USD for Wednesday, November 18, 2015

NZD/USD November 18 at 14:50 GMT

NZD/USD 0.6463 H: 0.6490 L: 0.6455


NZD/USD Technical

S3 S2 S1 R1 R2 R3
0.6233 0.6368 0.6449 0.6605 0.6738 0.6897
  • NZD/USD has shown limited movement during the day.
  • 0.6605 is the next resistance line.
  • 0.6449 is providing weak support and could be tested during the North American session.
  • Current range: 0.6449 to 0.6605

Further levels in both directions:

  • Below: 0.6449, 0.6368 and 0.6233
  • Above: 0.6605, 0.6738 and 0.6897


OANDA’s Open Positions Ratio

Short positions have made strong gains in the NZD/USD ratio, which currently has a majority of short positions (44:56). This is indicative of trader bias towards the pair losing ground.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Kenny Fisher

Kenny Fisher

Market Analyst at OANDA
A highly experienced financial market analyst with a focus on fundamental analysis, Kenneth Fisher’s daily commentary covers a broad range of markets including forex, equities and commodities. His work has been published in several major online financial publications including, Seeking Alpha and FXStreet. Based in Israel, Kenny has been a MarketPulse contributor since 2012.
Kenny Fisher

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