The New Zealand CPI (Consumer Price Index), which is released every quarter, measures the change in the price of goods and services charged to consumers. A reading which is higher than forecast is bullish for the New Zealand dollar.
Here are all the details, and 5 possible outcomes for NZD/USD.
Published on Monday at 22:45 GMT.
Indicator Background
CPI is considered the most important inflation indicator and is can have a major impact on the movement of NZD/USD.
Q1 for 2013 bounced back nicely after a decline in the previous quarter and posted a gain of 0.3%, matching the forecast. The markets are expecting a gain of 0.3% for Q2. Will the indicator meet or beat this prediction?
Sentiments and levels
New Zealand’s economic indicators have run into some turbulence as recent Trade Balance and GDP numbers missed their estimate. In addition, the sputtering Australian economy and the global slowdown global slowdown continue to be of great concern, Thus, the overall sentiment is bearish on NZD/USD towards this release.
Technical levels, from top to bottom: 0.8000, 0.7920, 0.7828, 0.77 and 0.7450.
5 Scenarios
- Within expectations: 0.0% to 0.6%. In this scenario, NZD/USD could show some slight fluctuation, but it is likely to remain within range, without breaking any levels.
- Above expectations: 0.7% to 1.0%: A strong reading than forecast could push the pair above one resistance level.
- Well above expectations: Above 1.0%: An unexpectedly sharp rise in inflation could push NZD/USD upwards, possibly breaking two or more lines of resistance.
- Below expectations: -0.4% to 0.1%: A reading in negative territory could pull the pair downwards, with one support level at risk.
- Well below expectations: Below -0.4%: Such a scenario could send the kiwi lower, possibly breaking two or more support levels.
For more on NZD/USD, see the New Zealand dollar forecast.
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