Business confidence in NZ has risen to its highest level since July, according to ANZ. Its Business Confidence Index jumped for the second month in a row, touching 35.8 (prior 34.4). In fact, ANZ was very pleased with the report, noting that all signs point towards broad-based growth.
There’s more NZ data and some Chinese economic numbers that may influence the kiwi later in the week. From China, we’re expecting both official and unofficial manufacturing numbers tomorrow, with the former and latter expected to be 49.7 and 49.3 respectively. In NZ, the release of the GDT Price Index on Thursday morning is always eventful.
Today’s data helped to spur rally in the kiwi as it fought some widespread USD strength in Asia. NZDUSD has been flirting with a key short-term support zone around 0.7490; a break of which may turn some bulls into short-term bears. The figures helped to push the pair of this level and towards some resistance around 0.7510.
The technicals for NZDUSD are also looking stronger after today’s report, at least on a short-term bias. There is some bullish divergence between RSI and price on a one-hour chart and some other techs are looking strong. However, the pair remains in a medium-term downward trend and it’s fighting widespread USD strength – a battle it can’t win if the US dollar continues to strengthen. Whilst it remains in this trend it’s hard to become bullish, especially if price rebounds off the top of this downward channel later today.