Henry Liu
Former FPA Special Consultant
- Messages
- 473
RBNZ (Reserve Bank of New Zealand) will be releasing its interest rate decision today and it is widely expected that Gov. Bollard will keep rates unchanged today at 3.00%; here is the forecast:
3:00pm (NY Time) RBNZ Rate Decision Forecast 3.00% Previous 3.00%
ACTION: NZD/USD BUY 3.25%
The Trade Plan
With current forecast from all 10+ economists surveyed by Bloomberg agreeing that RBNZ is likely to keep rates unchanged during this meeting, possibilities of getting in on a trade after the release is not very likely; however, in the event that Gov. Bollard surprises the market and hike rates to 3.25%, we should see an immediate strong demand in the NZD which is a great opportunity to spike trade BUY NZD/USD.
However, if we RBNZ keeps rate unchanged, we should stay out of the market.
For more information on my trading method:
Henry's Spike Trading Method
The Market
Despite of the inflationary pressure, most analysts agree that RBNZ will keep rates unchanged at the current level of 3.0%
As a matter of fact, most analysts agree that even if the inflationary pressure were to increase to 5.0% annually, RBNZ will still keep rates unchanged... This is due to the recent rise in commodity prices, or food and energy, plus the GST tax increase recently... Unless inflationary pressure is being generated from an overheating New Zealand economy, RBNZ is not likely to budge.
Additional Thoughts
NZD is a very slow moving currency and for a news of this caliber, decent retracements are not likely. Considering the expectation for this release, if we do get an "as expected", market will be focusing on the accompanied statement.
Also 3:00pm market is usually low in liquidity. Unless we get a surprise, it's probably best to stay out...
Pre-News Considerations
No pre-news trade for this release.
For more information on history charts and data of RBNZ Rate Decision...
Thanks,
3:00pm (NY Time) RBNZ Rate Decision Forecast 3.00% Previous 3.00%
ACTION: NZD/USD BUY 3.25%
The Trade Plan
With current forecast from all 10+ economists surveyed by Bloomberg agreeing that RBNZ is likely to keep rates unchanged during this meeting, possibilities of getting in on a trade after the release is not very likely; however, in the event that Gov. Bollard surprises the market and hike rates to 3.25%, we should see an immediate strong demand in the NZD which is a great opportunity to spike trade BUY NZD/USD.
However, if we RBNZ keeps rate unchanged, we should stay out of the market.
For more information on my trading method:
Henry's Spike Trading Method
The Market
Despite of the inflationary pressure, most analysts agree that RBNZ will keep rates unchanged at the current level of 3.0%
As a matter of fact, most analysts agree that even if the inflationary pressure were to increase to 5.0% annually, RBNZ will still keep rates unchanged... This is due to the recent rise in commodity prices, or food and energy, plus the GST tax increase recently... Unless inflationary pressure is being generated from an overheating New Zealand economy, RBNZ is not likely to budge.
Additional Thoughts
NZD is a very slow moving currency and for a news of this caliber, decent retracements are not likely. Considering the expectation for this release, if we do get an "as expected", market will be focusing on the accompanied statement.
Also 3:00pm market is usually low in liquidity. Unless we get a surprise, it's probably best to stay out...
Pre-News Considerations
No pre-news trade for this release.
For more information on history charts and data of RBNZ Rate Decision...
Thanks,
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