NZD/USD remains on the road to recovery ahead of New Zealand current account data


  • Fresh positive messages concerning G20 meet pleased Antipodeans.
  • New Zealand current account data is on the spotlight.

Renewed optimism surrounding the US-China trade talks helped the NZD/USD pair to succeed it its second attempt of recovery as it trades near 0.6530 at the start of Wednesday’s Asian session.

The Kiwi benefited from the latest news suggesting that there will be a meeting between the US President Donald Trump and his Chinese counterpart at the sidelines of the upcoming G20 and both the leaders are positive ahead of the global gathering.

With the Chinese media also being positive on the trade talks, the Antipodeans showed little reaction to the negatives elsewhere. As a result, New Zealand’s lesser than expected GDT price index couldn’t do much harm to the Kiwi buyers.

Despite being on the road to recovery for the first time in 12 days, traders remain cautious ahead of first quarter current account data from New Zealand and the all-important FOMC meeting.

Forecasts suggest, current account – GDP ratio to shrink from -3.7% to -3.5% while the headline current account is likely increasing to $0.526 billion versus $-3.256 billion on a quarterly basis during Q1 2019.

Ahead of the event, analysts at TD Securities said,

Q1 current account deficit looks like shrinking to —NZD1.58b or -3.2% of GDP (from -3.7%). Exports rose by at least +2% q/q, while imports fell slightly (lagged impact of falling oil prices). Our tracking suggests that net exports could add up to +0.8%pts to Q1 GDP.

On the other hand, FOMC is less likely to alter its current monetary policy but Chairman Jerome Powell’s press conference and dot plot will be in the spotlight.

Technical Analysis

In order to extend the latest pullback towards 50-day simple moving average (SMA) around 0.6605, the pair needs to cross 0.6560 upside barrier, failing to do so continues to highlight 0.6510 and 0.6480 as immediate supports.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.

Feed news

Latest Forex News

Editors’ Picks

AUD/USD rises above 50-HMA, bull reversal in the making?

The sell-off in AUD/USD seems to have run out of steam, courtesy easing RBA rate cut expectations after upbeat Australian CPI data. The pair trades above the 50-hour average. A close above 0.6765 would confirm a bullish reversal candlestick pattern on the daily chart. 

AUD/USD News

USD/JPY fills Monday's bearish gap ahead of Fed interest rate

USD/JPY has filled the gap created by Monday's negative open. Coronavirus fears have subsided in the last 24 hours, allowing recovery in USD/JPY. The respite could be short-lived if the Fed sounds dovish, sending the US dollar lower. 

USD/JPY News

Federal interest rate preview: Stable policy and an uncertain future

The course of the American economy has not altered since the previous FOMC meeting on Dec last year. 4Q growth is expected to be 2.1% when the preliminary figures are released by the Bureau of Economic Analysis on Thursday.

Read more

Gold: Bulls looking for a discount in $1560s

Gold top in the making with a weekly shooting star and weekly divergence. The price of gold has been found floundering between 1580 and the 1560s following a surge at the start of the year to the highest levels since March 2013 at $1,611.

Gold News

GBP/USD: 1.3080 questions break of short-term falling trendline

GBP/USD trades near 1.3025 during the early Wednesday’s trading session. The pair recently broke a three-day-old falling trend line but is still to cross the near-term key resistance confluence.

GBP/USD News

Forex MAJORS

Cryptocurrencies

Signatures