NZD/CAD dips after 0.9011 peak

Justin Freeman
Phone screen showing EURUSD Daily Price Graph

The New Zealand dollar was one of the forex market’s best performers last week, at least in the first few days.

This was especially true in relation to its pair with the Canadian dollar.

This pair saw a position of 0.9011 at one stage, which was its best performance since back in 2019.

However, the week later spelled problems for the pro-risk Kiwi dollar, which ended up finishing the week down by a fifth of a percentage point.

It then began the week in the gloomier setting of the 0.8800 to 0.8890 price range.

According to analysts, it could go one of two ways.

Price charts suggested that if it was to surge, then it may head to 0.8715, a position it hasn’t seen since the autumn of 2018.

With several events on the economic calendar set to affect the Kiwi dollar, nothing is yet confirmed.

Thursday morning, for example, will see the Reserve Bank of New Zealand release its inflation expectations for Q3 2020.

This was last revealed at 1.24% on a quarter-on-quarter basis.

This is expected to be published at 3am GMT.

However, the main event on the cards is likely to be next week, when the Reserve Bank of New Zealand publishes its interest rate decision during the night in the GMT timezone.

This is due to come out at 2am GMT on Wednesday of next week.

The rate currently sits at 0.25%.

At present, there is no confirmed forecast as to where policymakers at the bank are likely to go next.

The Reserve Bank of New Zealand is known for occasionally causing surprises when it comes to setting policy.

In February of this year, for example, its meeting did not result in a rate change but yet still managed to shift the markets substantially.

The bank unexpectedly shed a form of wording that it had previously used and that suggested that rate cuts in future months could occur – giving the bank a reputation for somewhat dynamic monetary policy setting.

Rate cuts did, of course, occur later as a result of the coronavirus pandemic.

As with many major central banks, they are now hyper-low in an attempt to stimulate the economy.

When this month’s announcement is made, it will be followed by a press conference at 3am GMT.

Even if no rate changes are on the cards, traders of both the NZD/CAD pair and the NZD/USD pair and others are expected to monitor it for either hawkish or dovish signs.

Later that day, there will be a further release from New Zealand.

Food price index data for the month of July will be out at 10:45pm GMT.

Month on month, this was last seen at 0.5%.

There is currently no prediction as to where or how this might move when it is published.

Justin Freeman

Latest news

Contagion Warning From Crypto Markets Could Be A Buy Signal
One of the reasons the 2020 market crash was so severe and sudden was that overextended investors sold out of positions to liquidate funds, which drove prices down further, and created a need for further selling. Read more
Market Guru Cathie Wood is Buying These Stocks Right Now
With the Nasdaq 100 index currently trading 28% lower than its January highs, the Q1 correction has transformed into a multi-month rout. Read more

Safest Forest Brokers 2020

Broker Info Best In Customer Satisfaction Score
#1 ForexTime LogoYour capital is at risk Founded: 2011 Global CFD & FX Broker
Number One Broker
#2 BlackBull Markets LogoYour capital is at risk Founded: 2014 Global Forex Broker
Number One Broker
BEST SPREADS Visit broker
#3 66% of retail CFD accounts lose money Founded: 2014 Global Forex & CFD Broker
Number One Broker
Best Trading Conditions Visit broker
#4 Forex Broker eToro Logo67% of CFD traders lose Founded: 2007 Global CFD & FX Broker
Number One Broker
#5 Forex Broker Pepperstone LogoBetween 74-89 % of retail investor accounts lose money when trading CFDs Founded: 2010 Global Forex Broker
Number One Broker
Low minimum deposit Visit broker

    Forex Fraud Certified Brokers

    Exness Small Logo
    AvaTrade logo
    XM Logo
    IQ Option Logo
    ATFX Logo
    skilling logo
    LegacyFX Small Logo
    IC Markets Logo
    BlackBull Markets Logo
    BDSwiss Logo
    Plus500 Small Logo
    FXTM Logo
    HYCM Logo
    Pepperstone Logo
    OctaFX Logo Logo
    City Index Logo