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26 Jan 2015
NZD/USD: Central Banks are main focus
FXStreet (Guatemala) - The NZD/USD, currently marginally bid and trading at 0.7440 is recovering from the lows of earlier but has opened the week under pressure from the downtrend at 0.7700 and 0.7600. This week will be about the FOMC and RBNZ.
Markets will be trying to second guess the RBNZ, especially after the BoC surprise rate cut. One of the outcomes could see the Central Bank drop its hawkish bias and return to neutral or even slightly dovish which could see vast amounts of pressure added to the already bearish trend in the Kiwi.
In respect to the FOMC, arriving before the RBNZ, analysts at TD Securities explained that the markets will look to the Fed for any signs that the central bank will stray from their expected path of normalizing rates later this year. "The absence of a post-meeting press conference and updated economic projections will leave markets with only a communiqué to discern any noticeable change in stance, though we do not expect a strong shift in the Fed’s message."
Markets will be trying to second guess the RBNZ, especially after the BoC surprise rate cut. One of the outcomes could see the Central Bank drop its hawkish bias and return to neutral or even slightly dovish which could see vast amounts of pressure added to the already bearish trend in the Kiwi.
In respect to the FOMC, arriving before the RBNZ, analysts at TD Securities explained that the markets will look to the Fed for any signs that the central bank will stray from their expected path of normalizing rates later this year. "The absence of a post-meeting press conference and updated economic projections will leave markets with only a communiqué to discern any noticeable change in stance, though we do not expect a strong shift in the Fed’s message."