The past two years have seen the biggest swings in oil prices in 14 years, which have baffled markets, investors, and traders due to geopolitical tensions and the shift towards clean energy.
NZD surged to highs of 2019
2020-09-18 • Updated
The New Zealand dollar is rising for the sixth straight day, outperforming its major peers. What is the reason? Let’s find out!
The kiwi was driven up by the optimistic comments of Finance Minister Grant Robertson. He claimed that the economic recovery turned out better than initially expected, and this may tone down the dovish Reserve Bank of New Zealand. Just to remind you, the dovish statement will push the NZD down, while the hawkish statement will push the NZD up.
By the way, the RBNZ will make a rate statement already on Wednesday. Therefore, the NZD will be in the center of traders’ attention in the upcoming days. However, some analysts still believe that the central bank will be forced to impose negative rates next year.
Robertson’s optimism over New Zealand’s sustained recovery was based on the upbeat GDP for the second quarter. After that, he added, that this positive data may influence the rate outlook after March 2021, because the RBNZ has to leave the current rate of 0.25% unchanged until this date.
NZD/USD has stepped out of the ascending channel, it has been trading for 10 days. However, it has failed to stabilize above the 200-week moving average at 0.6790. It’s falling to the low level of the first days of September at 0.6750. The move below this support will drive the pair to yesterday’s low of 0.6710.
The bearish scenario is more likely as the pair is constrained by the upper trendline and the 200-week moving average, so there is no room to run upwards. In addition, the overall market sentiment switched to risk-off, weighing on the riskier assets and underpinning safe-havens such as the US dollar. Resistance levels are 0.6790 and 0.6850.
After months of pressure from the White House, Saudi Arabia relented and agreed with other OPEC+ members to increase production.
What is going on with this energy asset these days, and should we prepare for further falls?
On Thursday, the 2nd of February, the Bank of England will publish its report concerning interest rates and inflation data for the Eurozone. Professionals and investors anticipate that Andrew Bailey’s lead team of policy makers will likely raise interest rates to 4%; the highest in over a decade, for the tenth time in a row.
The first FOMC meeting comes after a buildup of anticipation from traders and investors alike, as the markets await what posture the Fed will take regarding the interest rates; would there be a hike or a cut in interest rates?
Western countries are trying to find other options for oil and gas supplies after a 10th package of sanctions, which will put more pressure on Russian oil and decrease global oil supply. Italy, for example, is in talks with Libya.