Forex Marketz Daily Forex News – Fully Markets Update
The Kiwi Dollar (NZD/USD) Forex market soared higher, this morning, after better than expected consumer price index (CPI) data. Core prices rose 2.2 percent annually versus 2.0 percent expected. Prices were up 1.3 percent in the fourth quarter of 2016. This brings the headline inflation rate to its highest level in over five years.
For the quarter, quarter-on-quarter (QoQ), Consumer prices rose 1.0 percent compared to the prior quarter. This print bet expectations for a 0.8 percent gain and the 0.4 percent increase recorded in the three months to December 2016. This is the strongest increase, quarterly, with the CPI since December 2010.
The Kiwi Dollar soars on Rate Hike Bets
The Kiwi Dollar, after the news hit the wires soared higher before settling into a range trade. This is noted on the above MT Forex chart.
Last March, at the last monetary policy meeting for the Reserve Bank of New Zealand (RBNZ), the central bank stated that the CPI will be variable over the next year. However the target inflation should return to the midpoint within the bank’s target band, which is one to three percent, over the medium term. Still, RBNZ Governor Graeme Wheeler said that future monetary policy will remain accommodative for a “considerable period.” For him, there are still numerous uncertainties remaining. Especially when looking at the broader picture and the international outlook.
