-Cameron Bagrie, ANZ economist
Nothing can stop the RBNZ from further tightening in the coming months now. The latest report from the ANZ-Roy Morgan showed that New Zealand consumers felt more upbeat about their personal finances and the economy in general in June than a month earlier. Everything now speaks in favour of continuous rally of the Kiwi, with aggregate technical indicators pointing to the upside, while the next key targets for NZD/USD are located at 0.8744 and then at 0.8780.
A gauge of consumer sentiment ticked up 4 points to 132 this month, holding well above the threshold level at 100 points, which shows optimistic consumers outnumber those consumers who are pessimistic. A report indicates economic growth will accelerate further in the coming months, receiving a major boost from stronger confidence and willingness to spend. Employment is on the rise, while unemployment rate is falling, reflecting prospects for higher wages. Moreover, inflation rate is relatively low, also positively affecting consumers' mood.
A report also showed that a sub-index of household finances climbed to 13 to from 10 in May, while consumers maintained the view it is a good time to buy a major household item, meaning the increase of interest rates has not been detrimental to the households' budget.
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