NZ GDP Jumps and the Kiwi Spikes Higher

New Zealand GDP has been released this morning and the result was a strong one for the NZ economy.

Written by: Dime Levov • Wednesday, June 19, 2019 • 1 min read

• Last updated: Wednesday, June 19, 2019

New Zealand GDP has been released this morning and the result was a strong one for the NZ economy.

For the quarter we saw 0.6% vs the expected 0.6% q/q with a prior 0.6%. This was the more important number.

Annually that takes the GDP to 2.5% with the expected being 2.3% y/y which was the same as the prior 2.3%.

Overall a solid result and the NZD/USD has pushed higher as a result. We have to remember that the RBNZ has been quite dovish in recent times on the back of weak inflation numbers. They have been proactive in trying to boost the economy with a range of measure, both monetary and otherwise. So in some respects, it does seem to be working. How much we can attribute to the recent rate cut is hard to measure, but clearly, they will be happy with the result.

Technically, the Kiwi has bounced off the 0.6500 level after a period of sharp selling as the RBNZ was the key mover.

It now looks like the door is open for a move back up to the key 0.6600 level. With a strong base now in place at 0.6500 and we can see that there is now a higher low in place.

Could today’s number be the start of the up move? Let’s wait and see, but signs are better.