The Australian Dollar (AUD) slid against the New Zeland Dollar (NZD) after AiG construction performance news broke on Thursday. A major cut of around 22 points, the index remained 40.4, in June as compared to 42.6, the month before. The economists, however, refrained from expressing their opinion.
The interest rates announced by the Reserve Bank of Australia also shows a major cut which leads to a devaluation of the country’s currency. Normally, a hawkish attitude of the Reserve bank is considered as a sign of a bullish market for the Australian Dollar. However, the RBA seems to have a dovish view after suggesting a lower interest rate.
On the other hand, the Australian Bureau of Statistics releases somewhat favorable news for the Australian dollar. The data tells that the trade balance improved during the last quarter and stayed around 5745 M, as it was 4820, the quarter before. The economists also indicated an uprise in the said data by giving a value of 4820 M. It is to be noted that the trade balance represents the difference between import and export levels of the country. Both imports and exports levels stayed in coherence followed by a reasonable domestic demand in terms of imports and an unchanged or improved demand in exchange for exports of the country. So, the pair is believed to start moving positively.
Trading AUDNZD may not be a better idea for a short term position. However, it may get a reversal around 1.0300 and start recovering again. If this happens, trading pair for a long term position would give positive results.