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Euro to New Zealand Dollar Exchange Rate Forecast to Continue Trading Higher before ECB Report

Euro Exchange Rates

Although the appeal of the New Zealand Dollar was a little dampened by the news that card spending in the South Pacific nation unexpectedly declined in January, upbeat Chinese data helped the ‘Kiwi’ rebound and advance on the Euro.

The value of retail card spending in New Zealand fell by 0.5 per cent last month rather than advancing the 0.6 per cent expected.

General card spending in the nation dipped by 0.1 per cent in January, month-on-month, following an advance of 1.0 per cent in December.

The report prompted this response from economist Daniel Smith; ‘January card spending was softer than expected, but follows a period of strength. It does not change our view on consumer spending, which we expect will continue to grow healthily over 2014.’

Kiwi losses were limited following the data release, and the New Zealand Dollar later surged against the majority of its currency counterparts as China’s trade figures significantly surpassed expectations.

China’s trade surplus widened as exports surged by 10.6 per cent in January, year-on-year, up from an annual gain of 4.3 per cent in December and considerably more than the 0.1 per cent increase expected.

Imports were up 10.0 per cent on the year following December’s 8.3 per cent year-on-year gain, also considerably more than the estimate for a 4.0 per cent rise.

The impressive trade data appears to contradict signs that the world’s second largest economy is experiencing a slowdown.

While the data has triggered a resurgence of concern that fake shipments are being recorded, it did boost the currencies of China’s main trading partners, Australia and New Zealand.

Today’s industrial production report for the Eurozone could inspire additional movement. If output is shown to have fallen by 0.3 per cent in December, month-on-month, the Euro EUR/NZD pairing could extend declines.

Although demand for the ‘Kiwi’ could dip if New Zealand’s performance of manufacturing index falls from December’s 56.4 reading, we forecast that the Euro to New Zealand Dollar exchange rate will continue trading higher before the European Central Bank’s monthly report is published tomorrow.

Euro (EUR) Exchange Rates

[table width=”100%” colwidth=”50|50|50|50|50″ colalign=”left|left|left|left|left”]
Currency, ,Currency,Rate , 
Euro,,US Dollar,1.3631 ,
Euro,,British Pound,0.8285 ,
Euro,,Australian Dollar,1.5048 ,
Euro,,New Zealand Dollar,1.6311 ,
Euro,,Canadian Dollar,1.4972 ,

As of 09:10 GMT