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May 16, 2023 8:55 AM

NZD/USD Price Analysis: slips sharply two weeks low below 0.6200

NZD/USD Price Analysis: slips sharply two weeks low below 0.6200

The National Bureau of Statistics of China released annual Retail Sales numbers in April that were worse than expected, which caused the NZD/USD pair to fall below 0.6200. The economic statistics increased at a slower rate (18.4%) than anticipated (21.0%) but at a faster rate than the previous report (10.6%).

In addition, the annual Industrial Production statistics for April came in at 5.6%, which was between the predictions of 10.9% and the previous release of 3.9%. After the complete lockdown limitations were rolled back, the growth rates of industrial production and retail demand both slowed, showing that the Chinese economy is at least moving in the right direction.

It is important to note that New Zealand, along with the New Zealand Dollar, is one of China's top trading partners.

As market dissatisfaction grows in advance of US debt-ceiling discussions, losses on S&P500 futures have grown. The general market tone has changed to one of caution, and risky investments are becoming less appealing.

Investors are concerned that a further delay in raising the Federal borrowing ceiling may lead to the US Treasury defaulting on its contractual obligations, which has caused the US Dollar Index (DXY) to bounce back strongly over 102.40. Millions of jobs will be lost as a result, and the US leadership position and overall output would suffer significantly.

In addition, statistics on US retail sales will be examined closely. The monthly retail sales numbers for April are projected to grow by 0.7% rather than reduce by 0.6%. Retail demand strengthening should reduce expectations of a break in the Federal Reserve's (Fed) aggressive rate-hike cycle.

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