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Countercurrency price action weighed on Kiwi last week. Which factors will come into play in the next few days?

Quarterly GDP (Sept 18, 11:45 pm GMT)

Headline GDP registered at 0.6% in Q1 2019, which is in line with analysts’ expectations and Q4 2018’s reading and higher than the Reserve Bank of New Zealand (RBNZ)’s 0.4% estimates.

Turned out, construction was the main driver of growth as it improved from 3.7% against its 2.2% uptick in Q4 2018.

Traders were barely impressed, however. For one thing, the combo of subdued service sector activity and household spending as well as threats of housing market slowdown and immigration could still sway the RBNZ to cut its rates some more.

The soft details, together with weak risk appetite pushed the New Zealand dollar higher against the U.S. dollar but lower against its other counterparts.

This week analysts see Q2 2019 growth at 0.4% with the annualized version expected to slow down from 2.5% to 2.0%.

Take note that the event is sandwiched in between the FOMC’s highly awaited policy decision and Australia’s labor market numbers. That means that, unless we see significant hits or miss, then it’s likely that traders will price in the higher-tiered events than New Zealand’s GDP release.

Risk appetite and countercurrency price action

We know from last week’s price action that Kiwi turns into a classic high-yielding comdoll when traders are feeling like taking or avoiding risk.

The data calendar is chock full of top-tier economic events including policy decisions of the Fed, BOJ, SNB, and BOE; Australia’s labor market numbers; U.K.’s GDP and CPI releases, and Canada’s CPI and retail sales reports.

And then there’s the escalating geopolitical conflict in the Middle East, which has already caused weekend gaps across major forex pairs.

Read up and prepare for these events if you’re planning on trading a risk appetite-sensitive currency like the Kiwi!

Missed last week’s price action? Read NZD’s price recap for September 9 – 13!