New Zealand’s Financial Minister, Grant Robertson has crossed the wires and said, ” New Zealand will remain among least-indebted of peer nations.”
- Sees opportunity to break housing shortage.
- Net debt will rise well beyond previous targets.
- Expects budget deficits for an extended time.
- Budget economic outlook will be `sobering’.
Meanwhile, we have the Reserve Bank of New Zealand’s inflation expectations today. These are expected to drop sharply in the Q2 update, given the scale of the economic downturn. The Q1 read came in at 1.9%, just below the target midpoint.
NZD/USD traded from 0.6070 to 0.6010 overnight, weakened by prospects of milk supply and trodden down by the US dollar’s resurgence. Analysts at ANZ bank explained that the bird “looks to be under a bit under pressure this morning, with no real smoking gun other than perhaps continued EUR weakness and the question marks about the direction of CNY, with trade tensions brewing and talk that China might abandon a numeric growth target this year.”
A break below 0.60 would be ugly technically, and the downside risks look to have the upper hand, but short term it’s in a 0.6010/0.6075 channel.