NZD/USD hit 0.8135 on Friday, the pair’s highest since May 29; the pair subsequently consolidated at 0.8039 by close of trade on Friday, 0.68% lower for the day but still up 2.37% for the week, the first weekly advance in six weeks.
The pair is likely to find support at 0.7761, the low from June 11 and a 12-month low and resistance at 0.8135, Friday’s high.
A series of weaker-than-expected U.S. economic data releases on Friday raised concerns over the outlook for the economic recovery ahead of this week’s upcoming Federal Reserve policy meeting.
Data showed that the University of Michigan’s consumer sentiment index fell unexpectedly in the current month after rising to the highest level in almost six years in May.
Separate reports showed that U.S. industrial production was flat in May, while the capacity utilization rate fell unexpectedly last month.
Meanwhile, in New Zealand, the Reserve Bank of New Zealand held its benchmark interest rate at 2.50%, in a widely expected move on Thursday.
Commenting on the decision, RBNZ Governor Graeme Wheeler said that "despite having fallen over the past few weeks, the New Zealand dollar remains overvalued and continues to be a headwind for the tradables sector."
The central bank also cut its growth forecast for the year through March 2014 to 3% from 3.3%, and left its projection for the following year at 2.8%.
In the coming week, markets will be focusing on Wednesday’s Federal Reserve policy meeting, as investors look to Fed Chairman Ben Bernanke for any indication on when the U.S. central bank may start to unwind its easing policies.
Elsewhere, New Zealand will release a closely-watched report on first quarter economic growth.
Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets. The guide skips Friday as there are no relevant events on this day.
Monday, June 17
The U.S. is to publish the Empire state manufacturing index.
Also Monday, finance ministers and central bankers from the G8 group are to hold the first day of a two day summit in Northern Ireland.
Tuesday, June 18
The U.S. is to release official data on building permits, housing starts and consumer price inflation.
Meanwhile, finance ministers and central bankers from the G8 group are to hold the second day of a two day summit in Northern Ireland.
Wednesday, June 19
New Zealand is to produce data on the current account.
Later Wednesday, the Federal Reserve is to announce its federal funds rate and publish its rate statement. The statement is to be followed by a closely watched press conference with Chairman Ben Bernanke. The U.S. central bank is also to release its quarterly report on economic and inflation projections.
Thursday, June 20
New Zealand is to release data on first quarter gross domestic product, the broadest indicator of economic activity and the leading measure of the economy’s health.
China is to release the preliminary reading of the HSBC manufacturing index. The Asian nation is New Zealand’s largest trade partner.
The U.S. is to release the weekly government report on initial jobless claims, in addition to data on existing home sales and the Philly Fed manufacturing index.
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