NZD/USD is hit by Fonterra
NZD/USD fell towards $0.8505. New Zealand’s dollar was hurt because of the weakness from the country’s influential dairy sector: the nation’s dairy giant Fonterra slashed its forecast payout to farmers in the new season by 14%. The greenback was supported ahead of important news expected from the US this week starting with GDP and a Federal Reserve statement on Wednesday.
Support is at $0.8500, $0.8480 and $0.8450 (200-day MA) and $0.8410. Resistance is at $0.8572, $0.8590 ahead of $0.8625. The picture for the pair is pretty negative. Analysts at Bank of America think that NZD/USD has turned medium-, if not long-term down. In their view, the pair will fall to the 2.5-year channel support now at $0.7879.
At the last monetary policy statement meeting, the Reserve Bank of New Zealand (RBNZ) said it would pause and assess the economic situation before raising interest rates any more. The benchmark rate stands at 3.5% following four straight 25 basis point rises since March.ANZ business confidence index fell from 70.8 in February to 39.7 last week.
Chart. Daily NZD/USD