Prices and Charts
NZD Gold Down This Week But Bouncing Back Today
Overnight gold in NZ dollars got down as low as $1884. However a sharp fall in the Kiwi dollar (more on that soon) boosted gold back up close to the 50 day moving average again. As we write gold is at $1904.
This bounce higher isn’t shown in the chart below as the closing price on stockcharts came in before the fall in the NZ dollar.
So NZD gold remains well supported around the $1775 level. Staying above this mark since January. Anywhere close to that mark looks to be an excellent buying zone. But if this morning’s jump was anything to go by, you may need to be in fast for these “buy the dip” opportunities.
Silver Also Bouncing
Like gold, silver in NZ dollars also jumped higher this morning. Earlier on silver was sitting right on $22. But after the Kiwi dollar fall, nzd silver is back at $22.40. Once again right in between the 50 and 200 day moving averages.
So for silver buying anywhere near this $22 level has been a good buying zone for the past couple of months.
NZ Dollar Drops Sharply After Weaker Than Expected CPI Numbers
As mentioned above, the Kiwi dollar dropped sharply this morning when Statistics NZ released the latest Consumer Price Inflation (CPI) numbers.
“The New Zealand dollar fell by one US cent after Stats NZ data showed inflation eked out just a small gain in the March quarter, upping the ante for an interest rate cut next month.
The CPI rose 0.1 per cent in the March quarter bringing the annual rate of inflation to 1.5 per cent, down from 1.9 per cent in December, Stats NZ said.
The Kiwi dropped as low as US66.72c from US67.77c immediately before the release.
Economists had predicted the CPI rose 0.3 per cent in the three months ended March 31, for an annual increase of 1.7 per cent, according to the median estimate from a poll of economists by Bloomberg.”
We imagine the theory is that lower inflation adds weight to the notion that the central bank could cut the OCR soon – the above report reckons even as early as May.
Will the NZ Dollar Fall Further?
The chart below shows the NZ dollar closing below 0.67. This has been the support line since November last year. So a close below that points to lower prices ahead.
However the dollar only dipped briefly below 0.67 this morning. As we write it sits just above that mark. So we’d need to see a more conclusive move below the support line first.
But perhaps the odds have increased of a further fall for the NZ dollar now? We’d still say a potentially weaker NZ dollar is still – as we wrote last year – The Number One Reason to Buy Gold in New Zealand Today.
Need Help Understanding the Charts?
Check out this post if any of the terms we use when discussing the gold, silver and NZ Dollar charts are unknown to you:
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The RBA is Destroying The Australian Economy…and No One Cares. Is the RBNZ Destroying the New Zealand Economy Too?
Last week we read an excellent post by Greg Canavan on how the Reserve Bank of Australia is destroying the Aussie economy.
This got us thinking about the impact of our own central banks interest rate manipulations since the financial crisis.
We cover a fair bit of ground in this post including:
- How New Zealand is still at record low interest rates despite the “good times” we’ve seen in recent years.
- How house prices are softening at the same time as household debt is also at record highs.
- How real interest rates in New Zealand are also negative.
- Then we look at what does this all mean for New Zealand?
- And finally what will happen from here? Including the odds of money printing arriving in New Zealand.
So if you’re after a summary of where New Zealand currently sits check that out.
Your Questions Wanted
Remember, if you’ve got a specific question, be sure to send it in to be in the running for a 1oz silver coin.
There’s plenty of reading in this weeks feature article. So we’ll sign off there for this week.
Remember both gold and silver are hovering just above recent support levels. There are plenty of downside risks both at home and abroad currently.
So if you’re sitting on the sidelines, now is as good a time as any to take an initial position in either precious metal.
- Email: [email protected]
- Phone: 0800 888 GOLD ( 0800 888 465 ) (or +64 9 2813898)
- or Shop Online with indicative pricing
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