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Dairy Prices Continue To Surge, NZ Gov't Announcement On Housing Expected On Thursday

NZD

Tuesday saw NZD/USD fade its initial rally driven by a firmer risk sentiment. The rate operated within a 38 pip range, hovering above the $0.7100 mark and the nearby 50-DMA. There was little in the way of local catalysts to drive price action.

  • Headline GDT price index rose 4.8%, firming up for the fifth consecutive auction, while whole milk powder prices climbed 2.2% (matching market expectations), reaching the highest level since Dec 2016. Westpac raised their 2020/21 farmgate milk price forecast to NZ$7.50/kg after the auction, which is above Fonterra's forecast range.
  • The Green Party has called for measures to halt surging house prices. Interest.co.nz reported that Housing Minister Woods may make an announcement on public housing on Thursday.
  • NZD/USD trades at $0.7123, little changed on the day. Gains past Jan 13 & 14 highs of $0.7240 are needed to generate fresh bullish momentum and bring Jan 6 high of $0.7315 into view. Bears need a fall through the round figure of $0.7100 before taking aim at Dec 28, 2020 low/50-DMA at $0.7084/82.
  • New Zealand's BusinessNZ M'fing PMI & quarterly CPI report will be released on Friday morning.

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