The NZD/USD pair continued the upside journey as kiwi gained grounds on Wednesday following reports of stronger recovery in the housing sector and rising prices.
New Zealand’s economic recovery is ongoing, and surely supported by strong growth from China and demand for commodities, which is why we expect the volatility to remain for the week with Chinese growth figures awaited.
Further, the Kiwi soared versus majors because of the positive signs of global economic growth, which boosted the demand for the New Zealand currency as a higher-yielding currency supported by its own good fundamentals which kept its appeal as a strong yielder.
The Real Estate Institute said on Wednesday that the house price index for the month of March increased 0.5% supporting kiwi’s gains.
As for the US economy, the Federal Reserve is reluctant to increase interest rates, signaling the continued gains for the New Zealand dollar this year.
On Thursday, the New Zealand economy won’t release any fundamental data, but the world’s largest economy at 12:30 GMT will release the weekly initial claims numbers, where the number of people filing for first-time claims for the state unemployment benefits is expected marginally steady at 380 thousand following 382 thousands the previous week; continuing claims are expected to have dropped to 3703 thousand from 3723 thousand.
The U.S. PPI for March will be released at 12:30 GMT as well; inflation is expected to have eased on the month with 1.0% rise following 1. 6% and steady on the year at 0.2%. Excluding food and energy prices at factory gates are expected to have ticked higher at 6.2% on the month following 5.6% and at 1.9% on the year. The subdued inflation pressures supports kiwi to extend gains on expected delay in feds change of monetary policy.
Originally posted here
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