OctaFX | OctaFX Forex Broker
Open trading account
Back

Forex Flash: The RBNZ will not intervene - TDS

To the question of whether the RBNZ will intervene or not, Alvin Pontoh, Asia-Pac Macro Strategist at TD Securities, answers with an outright "No".

Mr. Pontoh notes: "RBNZ Governor Wheeler maintains that the RBNZ cannot fight “the strength of capital flows” that has pushed the Kiwi upwards. Even if the RBNZ intervenes, it is constrained to merely “smooth[ing] the peaks”. If this can be achieved with negligible cost through ‘open mouth operations’, then why intervene in the first place with precious few resources at hand?"

"Ultimately, Mr Wheeler’s preferred solution is lifting “productivity” to meet the lofty currency, as clearly manifest in the title of the speech: “Manufacturing decline not just a dollar story”. Rather than a signal of imminent currency intervention, it is a call on businesses to adapt to new circumstances and for the government to help facilitate this" Mr. Pontoh adds.

Forex: EUR/USD still below 1.3200

EUR/USD broke Thursday its mid term ascending trend line coming from July 1.20s lows, now above around the 1.3250 area, with global equity and commodity markets to the downside, and bonds and USD to the upside, showing the inflows to considered shave haven assets. Last at 1.3190, the pair bounces from fresh 1-month lows at 1.3160 printed in late NY trade, down -1.10% for the week so far.
Read more Previous

China House Price Index 0.8% in Jan

Read more Next
Start livechat