While news updates for the USD and GBP seem to show strength is coming, there are actually some deep concerns for the NZD and AUD. According to Graeme Wheeler of the NZ Reserve Bank, the NZD is not going to see good results coming along in the new year. There is too much at stake right now. Further in foreign exchange Sydney there are disappointments on the horizon. The elections are over, but there is concern that the softer than expected results for the year will continue to plague the nation for the coming year.
Foreign Exchange Sydney Traders Watch OCR
OCR is likely to increase next year due to requirement. The policy rates may need to rise and to what extent needed is all based on the housing market and construction occurring. There might be more demand for it, but inflation is at a high increasing the pressures on the NZD and foreign exchange Sydney. New Zealand tends to trade with Australia for exports and imports the most, thus the two are linked.
Other details about the NZD show the currency hitting its highest level against the USD. The New Zealand Reserve Bank decided not to adjust the monetary policy which was seen as a positive key. The interest rate is holding at 2.5%, but it might change next year if inflation continues to hold around 2%. The interest rate for refinances was cut back due to an earthquake. The Canterbury earthquake has helped shore up construction, but it also affected the economy enough to warrant better rates for those in need of rebuilding or starting over. The downside is experts expect inflation to go towards 3.5% next year instead of holding near 2%. It could affect the appreciation of the NZD against major currencies.
Foreign Exchange Sydney AUD News
The AUD is soft and the economy data is disappointing according to Westpac. The Reserve Bank is most likely going to lower interest rates going forward due to trouble in the economy. The government has a lot of challenges going forward including being new kids on the block. Foreign exchange Sydney saw some increase in the AUD with better results from China, but experts think it is a temporary gain. There is more likely to be a downswing due to the year to year decline seen for the last two years. Unemployment numbers are up, which does nothing to help the currency and the economy.
Business and consumer confidence is going in a better direction; however, it is slowing down. It could be on a path of reversal due to poor labour market data. Still, if the government reacts appropriately and the reserve bank takes action to lower interest rates there could be better trading in foreign exchange Sydney. Not everything is bad since there are signs of housing rebounds. The biggest challenge is to get the economy away from mining industries as Australia is hitting the end to this growth helper. Mining in many areas can only support a place so long before it comes to an end as the biggest economic support.
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