New Zealand Dollar (NZD) Inched Higher Amid Trade Balance Release

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It’s the second day in a row since the New Zealand Dollar continues to rise with a price tag of more than 0.6500. The price increase occurs as a result of an improvement in the economic trade balance. According to the report, it remained $-5.04 M, as compared to $-5.33 M a year earlier, it also met the estimates of economists, which was  $-5.33M.

Trade balance, released by Statistics New Zealand, is the difference over a period of the year between the value of country exports and imports. A positive balance means exports outweigh imports, the reverse means negative ones. The positive trade balance shows the high competitiveness of the economy of the country.

Similarly, this month’s Business NZ indicator remained 52.6 as compared to 48.4, the previous month meeting economist expectations of 52.6. The monthly PMI Business NZ reflects the business conditions of New Zealand. It is considered an important indicator of the economic state of the overall country.

The values above 50 indicate a bullish NZD market whereas, permits to build s.a. Released by Statistics New Zealand shows a negative impact with a sharp drop from 7.4% to -1.1%, which means fewer permits for new construction projects leading to a low negative reading or bearish for NZD.

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Also, the GDT price index, falls t0 1.7 percent from 3.4 percent, to be used to avoid the bias of a simple weighted average price, and to give a more precise reflection of the price movements between trade events.

Conclusion

Trading the pair around current levels can be financially viable. The technical bias may continue to follow the bullish pattern until a strong resistance comes across which might push back the price towards the downside. 

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