NZD/USD – New Zealand dollar drops ahead of manufacturing, inflation reports

The New Zealand dollar has posted losses in the Thursday session. In North American trade, NZD/USD is trading at 0.6545, down 0.30% on the day. On the release front, New Zealand will release the Business NZ Manufacturing Index, as well as PPI Output and PPI Input. The U.S. posted strong data, led by unemployment claims, which dropped sharply to 212 thousand. This marked a 4-week low. Housing and manufacturing reports improved in April and beat their forecasts.

The New Zealand dollar has been roughed up in the second quarter, declining 3.9%. The New Zealand economy has been hurt by the global slowdown, which has reduced the demand for New Zealand exports. China is New Zealand’s largest trade partner, with 24.9% of New Zealand exports going to the Asian giant. The ongoing trade war between the U.S. and China has caused a slowdown in the Chinese economy. China posted disappointing numbers this week, as industrial production and retail sales fell sharply in April. Weak global economic conditions and the latest round of tariffs between the U.S. and China have weighed on risk appetite, which has made risk currencies, such as the New Zealand dollar, less attractive to investors.

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NZD/USD Fundamentals

Wednesday (May 15)

• 18:30 New Zealand Business NZ Manufacturing Index
• 18:45 New Zealand PPI Input
• 18:45 New Zealand PPI Output

Thursday (May 16)

• 8:30 US Building Permits. Estimate 1.29M. Actual 1.30M
  
• 8:30 US Unemployment Claims. Estimate 220K. Actual 212K
  
• 8:30 US Philly Fed Manufacturing Index. Estimate 10.0. Actual 16.6
  
• 8:30 US Housing Starts. Estimate 1.21M. Actual 1.24M
• 10:30 US Natural Gas Storage. Estimate 105B
• 12:15 US FOMC Member Brainard Speaks

Friday (May 17)

• 10:00 US Preliminary UoM Consumer Sentiment. Estimate 97.8

*All release times are DST

*Key events are in bold

NZD/USD for Thursday, May 16, 2019

NZD/USD May 16 at 12:40 DST

Open: 0.6564 Low: 0.6582 High: 0.6545 Close: 0.6545

NZD/USD Technical

NZD/USD posted small losses in the Asian session. The pair posted considerable gains in European trade but then retracted. NZD/USD continues to lose ground in the North American session

• 0.6539 is under pressure in support
• 0.6607 is the next resistance line
• Current range: 0.6539 to 0.6607

Further levels in both directions:

• Below: 0.6539, 0.6424 and 0.6348
• Above: 0.6607, 0.6699, and 0.6793

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