New Zealand Gross Domestic Product (GDP) is a key release, released each quarter, which measures production and growth of the economy. Analysts consider GDP one the most important indicators of economic activity. A reading which is better than the market forecast is bullish for the New Zealand dollar.
Here are all the details, and 5 possible outcomes for NZD/USD.
Published on Wednesday at 21:45 GMT.
Indicator Background
New Zealand GDP is a key economic indicator, and provides an excellent indication of the health and direction of the New Zealand economy. Traders should pay close attention to the GDP release, as any unexpected reading could affect the direction of NZD/USD.
GDP improved to 0.9% in Q2, although this was short of the estimate of 1.1%. The estimate for the Q3 report stands at 0.8%.
Sentiments and levels
The FED raised rates and went hawkish, and the kiwi has responded with sharp losses, dropping 3.8% since the announcement. So, the overall sentiment is bearish on NZD/USD towards this release.
Technical levels, from top to bottom: 0.7100, 0.7075, 0.7035, 0.7000 and 0.6940
5 Scenarios
- Within expectations: 0.5% to 1.1%. In such a scenario, NZD/USD is likely to rise within range, with a small chance of breaking higher.
- Above expectations: 1.2% to 1.5%: An unexpected higher reading can push the pair above one resistance line.
- Well above expectations: Above 1.5%: A surge in the reading would bolster the kiwi, and the pair could break a second resistance line as a result.
- Below expectations: 0.0% to 0.4%: A weak reading could see the pair break below one support line.
- Well below expectations: Below 0.0%. A negative GDP reading could push NZD/USD below a second level of support.
For more on the kiwi, see the NZD/USD forecast.
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