The New Zealand dollar strengthened against the other major currencies in the Asian session on Thursday after Fonterra announced higher than expected dairy payout forecast.
Fonterra Cooperative Group Ltd., the world’s biggest dairy exporter, raised its payout forecast to farmers for the 2016 season to $4.60 per kilogram of milk solids from $3.85/kgMS.
The Auckland-based co-operative also said the net profit after tax was NZ$506 million in the year to July 31 compared with NZ$179 million a year ago.
Additionally, the company raised its full-year dividend forecast to 40 to 50 NZ cents per share, compared with 25 to 35 NZ cents per share for the year just ended.
Meanwhile, the currency trimmed some of its gains after the release of nation’s trade data, although it climbed back shortly after.
Data from Statistics New Zealand showed that New Zealand posted a merchandise trade deficit of NZ$1.03 billion in August, representing 28 percent of exports. The headline figure missed forecasts for a shortfall of NZ$875 million following the NZ$649 million deficit in July.
Exports were worth NZ$3.73 billion, down from NZ$4.20 billion in the previous month. On a yearly basis, exports climbed NZ$197 million or 5.6 percent. Imports were worth NZ$4.77 billion, down from NZ$4.85 billion a month earlier. On a yearly basis, imports jumped 19.0 percent.
Wednesday, the NZ dollar fell 0.25 percent against the U.S. dollar, 0.15 percent against the yen and 1.07 percent against the euro.
In the Asian trading, the NZ dollar rose to a 2-week high of 1.1132 against the Australian dollar and a 2-day high of 75.78 against the yen, from yesterday’s closing quotes of 1.1155 and 75.44, respectively. If the kiwi extends its uptrend, it is likely to find resistance around 1.09 against the aussie and 78.00 against the yen.
Against the U.S. dollar and the euro, the kiwi edged up to 0.6301 and 1.7723 from yesterday’s closing quotes of 0.6272 and 1.7820, respectively. On the upside, 0.64 against the greenback and 1.73 against the euro are seen as the next resistance levels for the kiwi.
Looking ahead, Japan all industry activity index for July is due to be released at 12:30 am ET. Subsequently, Germany’s Gfk consumer confidence index for October is set to be published at 2:00 am ET.
At 1:30 am ET, Reserve Bank of Australia’s head of economic analysis Alex Heath is expected to speak at an Urban Development Institute of Australia Luncheon in Perth, Australia.
In the European session, the German IFO business climate index for September and U.K. BBA mortgage approvals for August are slated for release.
In the New York session, U.S. durable goods orders for August, U.S. weekly jobless claims for the week ended September 19 and U.S. new home sales for August are set to be announced.
The material has been provided by InstaForex Company – www.instaforex.com