NZDUSD Futures: Pay attention to Farmer’s market
Bloomberg: Things are relatively quiet on the trade front, but there are signs of progress. U.S. Agriculture Secretary Sonny Perdue described negotiations as “dynamic,” saying China could triple its 2017 purchases of U.S. farm goods in the next five years. Perdue also confirmed that there would have to be an agriculture deal as part of any trade deal with the EU.
Perdue’s statement contributed positively to the risk perception in the global markets, while boosting the currencies and indices of developing countries.
Before the trade wars, China’s annual agricultural commodity imports from the US was about 20 billion USD, with an additional 30 billion USD annually after the agreement will be extremely positive for the US economy.
Perdue pointed out that China’s products imported from the US are not only limited to soy, corn and cereals, but also that meat exports to this country are also an important item.
The US-China deal continues to support the global risk appetite while supporting the indices and emerging market currencies.
Who will be affected in this case?
Of course New Zeland: New Zealand is one of the top exporters of grain, dairy and meat products to China.
New Zealand’s export to China is crucial for its economy. When we look at trade partners, China is the biggest supporter of New Zealand with 24.9%.
In this case, a possible deal in trade negotiations may seem positive for global risk perception, but New Zealand may be the loser of the day.
Dairy products and meat take first place in New Zealand’s export items. Especially the share of meat and meat products is important.
When we look at the central bank policies
RBNZ is one of the most dovish central banks and not expected any interest rate hike before the end of 2020.
FED, on the other hand, continues to hold the possibility of an increase in interest rate for this year.
0.68000 support is critical. We plan to sell NZDUSD as soon as it breaks out 0.68000 support. Our stop loss will be 0.68800.
Ascending triangle and SHS patterns are still in charge.
and the ultimate target of the formation: 0.62200
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