The New Zealand currency continues to trade in a corrective uptrend around 0.6420, despite the fact that macroeconomic statistics remain rather restrained.
On Friday, Stats NZ published a report on food prices, which rose by 7.4% in July in annual terms. Among the key categories of price increases are: basic food products (+7.5%), restaurant meals (+6.6%), fruits and vegetables (+10.0%), meat and fish (+7.7%) and non-alcoholic drinks (+4.6%). On a monthly basis, the growth in food inflation amounted to 2.1%, and the fact that the negative dynamics is recorded taking into account lower energy prices indicates that the measures taken by the Reserve Bank of New Zealand (RBNZ) are not enough yet.
The American currency, meanwhile, continues its corrective dynamics, fixing just below 106.000 in the USD Index. The situation in the US economy remains extremely tense. The day before, the Internet media MarketWatch published an article reporting on the state of the portfolios of large US government pension funds, the average drawdown of which was 7.9% since the beginning of this year, which is the worst dynamics since 2009. For the second quarter, the net investment loss of budgetary pension funds amounted to 8.9%. Thus, in order to continue paying pensions, state governments need to increase the amount of additional revenue, including taxes, which will lead to discontent among citizens.
Quotes of NZD/USD continue to trade within the global downtrend, gradually approaching the resistance line. Technical indicators maintain the buy signal: the fast EMAs of the Alligator indicator are above the signal line, and the histogram of the AO oscillator is trading in the buy zone, forming ascending bars.
Support levels: 0.6360, 0.6211. | Resistance levels: 0.6470, 0.6670.