Forex: NZD/USD up despite weak NZ inflation data
_iNVEZZ.com Tuesday July 16th:_ The kiwi has eased against the US dollar in European session today, notwithstanding weak New Zealand inflation data released earlier today, with the pair having risen to a two-day high at 0.7870 so far.
The New Zealand CPI for the second quarter of the year rose 0.7 percent y/y, the lowest level since 1999 and missing expectations for a 0.8 percent increase. The number was also the fourth annual increase in a row below one percent. Quarter-on-quarter, Q2’s CPI rose 0.2 percent, less than the expected 0.3 percent and following a 0.4 percent increase the prior quarter.
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Chris Tennent-Brown, FX economist at Commonwealth Bank of Australia in Sydney, observed: “Our forecast is for the Kiwi dollar to be lower over the next year, and we have to factor in the dampening impact of the tradable sector is not going to be there. There’s not really too much (in the CPI) to change people’s expectation for the RBNZ.”
Traders are now focused on US releases at 13:30 BST today for the June y/y readings in the CPI and CPI excluding food and energy.