The Gross Domestic Product (GDP), is a quarterly index which measures the production and growth of the economy. Analysts consider GDP one of the most important economic indicators, thus the publication of the New Zealand GDP may well have a critical effect on NZD/USD.
Here are all the details, and 5 possible outcomes for NZD/USD.
Published on Thursday at 1:45 GMT.
Indicator Background
As the broadest indicator of the economy, investors look closely at GDP for an indication of where the economy is headed.
New Zealand has seen GDP rise from 0.2% in March to 0.8% in July, the highest reading in some 16 months. However, the forecast for September is lower, with a reading of 0.5%. Although consumer spending is up, it seems too early to tell if the New Zealand economy is moving in a positive direction.
Sentiments and levels
The September forecast for New Zealand GDP is slightly down compared to the previous quarter, and the fragile world economy is not giving the kiwi much chance to rise. Thus, the overall sentiment is neutral on NZD/USD towards this release.
Technical levels, from top to bottom: 0.8620, 0.8580, 0.8505, 0.8410, 0.8330, 0.8180 and 0.8075.
5 Scenarios
- Within expectations: 0.2% to 1.1%. In such a scenario, NZD/USD may fluctuate slightly, with a small chance of breaking higher.
- Above expectations: 1.2% to 1.6%: An unexpected higher reading can send the pair well above one resistance line.
- Well above expectations: Above 1.6%: The chances of such a scenario are low. Such an outcome would propel NZD/USY upwards, and a second resistance line might be broken as a result.
- Below expectations: -0.7% to 0.1%: A decrease in GDP or smaller increase than forecast could cause the pair to drop below one support level.
- Well below expectations: Under -0.7%. A sharp drop in GDP cannot be discounted, given the global economic turmoil and uncertainty. In this scenario, the NZD/USD could drop substantially and break a second support level.
For more about the NZD/USD, see the NZD/USD forecast.