High gasoline prices have become the main reasons for the 0.8% growth of the Consumer Price Index (CPI) in New Zealand over the 1st quarter of 2011, while the annual value has grown by 4.5%.
The second reason for the CPI growth is tobacco products (9.4% growth). The foodstuff prices have gained only 1.2%. However, NZ’s tourism businesses have recently shown a decline. But for the increase in the prices on tobacco and oil products, the index would have grown only by 0.1%.
The 4,5% annual increase is the highest one since September 2008. This is the result of the sales-tax hike up to 15% introduced on Oct 1st 2010. The factor is believed to add 2.2% to the annual value.
The Reserve bank of New Zealand’s forecast (y/y) is 4.4%. The actual data have nearly matched the forecast. Now the central bank needs to make a forecast concerning the key interest rate. There are suppositions that the bank is going to maintain the rate at the record-low level of 2.5% until December 2011. However, the inflation pressure on the economy as the result of the recent earthquake in Christchurch may force the bank to raise the interest rate much earlier.
FOREX. NZDUSD has managed to update the high of 2010. Expert from the Department of studying Masterforex-V trading system explain that in long-term perspective the currency pair is forming wave a(C ) or C of Weekly as the following upward movement will be developed through this wave pattern. In this case the closest significant resistance level will be found at 0,8212 (the high of 2008). If there is a downward movement it will take place in the form of wave b(C ), but a break of the MF pivot and sloping channel will initiate a bearish momentum against the main trend of Weekly 2, while the moment of truth and the following bearish FZR will indicate a mid-term trend reversal, which may be only a correction within the classic ABC pattern against the long-term uptrend. The MF pivot and sloping channel (as shown in the picture) will act as support levels.
