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Forex Fundamentals of Country Profile 9-New Zealand

If youve seen Lord of the R ForexRapidRebategs, you probably know that Middle-earth was set in the mountains of Forex Rapid Rebate rebateforexfee In addition to being the home of Baggins (FroboBaggins) rebateforexbroker h rebateforex Hobbit friends, New Zealand is also one of Australias neighbors in Oceania, located in the southern Pacific Ocean The country consists of two main islands, the North Island and the South Island, in addition to a number of The small island is known for having more sheep than people New Zealand has 4 million inhabitants To give you a better idea of what this represents, lets take the example of New York alone, which had a population of 8.4 million in 2011 New Zealand is also known as Aotearoa, the Maori word for the land of long white clouds Maori is one of the main languages spoken in New Zealand New Zealand: Facts, figures and characteristics Neighboring countries: Australia, Fiji, Tonga Area. 104,454 square miles Population: 4,268,600 Population density: 40.9 per square kilometer Capital: Wellington Head of State: Queen Elizabeth II Head of Government: Prime Minister John Kerry Ki currency: New Zealand cashback forex (NZD) major imports: machinery and equipment, vehicles and aircraft, experimental products, petroleum, electronics, textiles, plastics major exports: Crowe (RussellCrowe), ores and metals, wool food and livestock, fuel, transportation machinery and equipment import partners: Germany 13.5%, the United States 10.2%, France 8.1%, the Netherlands 6.3%, Belgium 4.9%, Italy 4.9%, Italy 4.3%, and the United States 4.3%. Belgium 4.9%, Italy 4.7% Export partners: United States 15.7%, Germany 10.5%, France 9.5%, Netherlands 6.9%, Ireland 6.5%, Belgium 5.6%, Spain 4.4%, Italy 4.4% Time zone: 12 East Website: In 2011, New Zealands GDP was $123 billion, ranking 65th among all economies in the world, but dont underestimate New Zealand, it plays a very important role in world trade. It also exports cattle and dairy products, Angus beef. New Zealands main industries include agriculture and tourism, while its manufacturing and technology sectors are small. As a result, its imports from other countries include heavy machinery, equipment, vehicles and electronics. Monetary and fiscal policy is currently governed by Bernard, the New Zealand Federal Reserve holds eight monetary policy meetings per year The central banks mandate is to maintain price stability, set interest rates and monitor output and the exchange rate In order to maintain price stability, the New Zealand Federal Reserve has to ensure that the annual inflation rate reaches the standard set by the central bank of 1.5%, otherwise the government has the right to fire the governor of the Reserve Bank of New Zealand (we are not kidding) The New Zealand Federal Reserve There are several monetary policy tools: the official discount rate is set by the chairman of the New Zealand Federal Reserve and will affect the level of short-term interest rates lending at 25 points above the official discount rate and borrowing at 25 points below that rate, the central bank can regulate interest rates for individuals and businesses open market operations are designed to meet cash targets or the amount of reserves held in commercial banks by forecasting daily cash targets, the New Zealand Federal Reserve can calculate How much money will have to be injected into the economy to meet its target Understanding the New Zealand DollarThe New Zealand dollar (NZD) is nicknamed the fewveeIt is a birdThe fewvee is a symbol of New Zealand…… but lets take a look at the countrys currency known as the fewvee and its interesting featuresLet me see these commodities! Since New Zealands economy relies on commodity and agricultural exports, the countrys economic performance is closely linked to commodity prices If commodity prices increase, the price of New Zealands exports increases accordingly, which will contribute more GDP to the country High GDP indicates a good economic performance, which will lead to an appreciation of the New Zealand dollar Conversely, lower commodity prices mean lower total export prices and a smaller contribution to GDP Low GDP will lead to I work hand in hand with the Australian dollar because Australia is New Zealands number one trading partner, so Australian economic performance has a significant impact on the New Zealand economy. New Zealand, of course! …… As with the Australian dollar, I enjoy the arbitrage trade! As with Australia, the difference in interest rates between New Zealands higher interest rates compared to other economies such as the US, UK and Japan is an indicator of capital flows As investors favor higher yields, they sell low-yielding investments and buy high-yielding assets or currencies In other words, the higher the interest rates, the higher the inflows I want more immigrants because New Zealands population is less than half the population of New York I am also sensitive to weather conditions New Zealands economy is largely influenced by agriculture, which means severe weather conditions, such as drought, have a significant negative impact on the countrys economy Heat waves also affect Australia and cause forest fires, which in turn cause losses of 1% of its GDP This has a negative impact on New Zealand Important economic indicators related to the New Zealand dollar Gross Domestic Product (GDP): Like other countries, GDP is a part of New Zealands economic reporting GDP is used to measure the overall performance of the New Zealand economy and can have an impact on the demand for the New Zealand dollar Consumer Price Index (CPI): CPI measures the change in the price level as a measure of inflation, it is closely monitored by the New Zealand Federal Reserve, to determine changes in monetary policy. to determine the change in monetary policy it aims to maintain price stability, remember? Trade Balance: New Zealands economy is export oriented and the trade balance is usually looked at to determine the international demand for products produced in New Zealand. Positive GDP growth reflects that the New Zealand economy is doing well, which will increase demand for the New Zealand dollar Negative GDP growth figures indicate that the countrys economy is performing poorly, which will depress demand for the New Zealand dollar A surge in exports and high demand for New Zealand products usually means high GDP, which in turn will lead to an appreciation of the New Zealand dollar Conversely, low export volumes contribute less to GDP, which will lead to a depreciation of the New Zealand dollar Commodity prices rise Higher prices lead to higher value of New Zealand exports, which in turn boosts GDP Lower commodity prices lead to lower value of exports, which in turn lowers GDP New Zealand dollar/US dollar trading New Zealand dollar/US dollar trading positions are measured in US dollars The value of each point is calculated based on the current price of the New Zealand dollar/US dollar (four decimal places are one point) Gains and losses are denominated in US dollars For a position of 100,000 units of New Zealand dollar/US dollar, the value of each point of change is For a position of 10,000 units of NZD/USD, the movement per point is $1. Margin trading is calculated based on the US dollar. For example, if the current rate of NZD/USD is 0.7000 and the leverage ratio is 100:1, it takes $700 to trade a position of 100,000 NZD and $70 to trade a position of 10,000 NZD. Among all major currencies, it requires the least amount of margin, which means it is cheaper to trade NZD/USD Trading Tips New Zealand Strong economic report will lead to NZD appreciation If the economic report has a higher chance of being good, which means one should go long on NZD/USD Poor economic report performance will lead to NZD depreciation If the future economic report is lower than expected, which means one should go short on NZD/USD In addition to paying attention to economic reports, paying attention to commodity price behavior can also lead to NZD/USD depreciation. Most of the time, when demand for risky assets is strong, commodity prices rise and investors will put their money into high-yielding assets such as gold and other commodities and sell low-yielding dollars. On the other hand, when risk aversion forces investors to flee to the safe-haven dollar, the New Zealand dollar depreciates against the U.S. dollar. Like Australia, the New Zealand dollar is an excellent candidate for an arbitrage trade, which involves buying a high interest rate currency and selling a low interest rate currency, with New Zealands higher interest rate support New Zealand dollar arbitrage trade

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