FX News – Jan 21 2014: NZD Gets Boost from Positive NZ CPI

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New Zealand's better-than-expected Consumer Price Index (CPI) figures helped boost the NZD against a number of major currencies early in today's trading.

The country's CPI rose by 1.6% in the past 12 months, which was better than the projected 1.5% rise. Meanwhile, it rose by 0.1% compared to the previous quarter, which beat expectations of a contraction by 0.1%. The CPI for the previous quarter was at 0.9%.
With the release of the CPI data, the USD/NZD pair received a boost after spending much of yesterday's trading around the 0.8230-0.8250 range. It is currently trading at 0.8323, with initial resistance seen at 0.8309, followed by 0.8330. On the other hand, initial support is at 0.8197, followed by 0.8176.

The kiwi also gained strength against the aussie with New Zealand's positive CPI. This led to a sharp decline in the AUD/NZD pair at the moment. Yesterday the pair peaked near 1.0700, but at the moment it is trading at 1.0581. Initial resistance for the pair is at 1.0684, followed by 1.0711. Meanwhile, initial support is at 1.0587, followed by 1.0561.

Aside from New Zealand's CPI data, other news that could significantly affect the pair would come from Australia during tomorrow's Asian trading. These include Consumer Confidence in January (21 Jan, 11:30pm, GMT), and a number of CPI-related data (22 Jan, 12:30am, GMT). Australia's CPI is expected to rise by 2.5% in the fourth quarter compared to the past 12 months, while a 0.5% is expected compared to the previous quarter.

As for the USD/JPY pair, it spent most of yesterday's trading seesawing within the 103.90 and 104.30 range mainly due to the lack of significant data that could affect the pair. It sank below the 104.00 twice, but has recovered on both occasions. 

The major news that is relevant to the pair at the moment is the upcoming interest rate decision of the Bank of Japan, which will happen tomorrow morning (22 Jan, 3:00am, GMT).

The USD/JPY pair is currently trading at 104.15, with initial resistance seen at 104.38, followed by 104.65. Meanwhile, initial support is at 104.08, followed by 104.32.

By FX Strategy Team, Published on 20th of January 2014
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