This week the NZD/JPY rates continue in the frames of the weak uptrend in favour of the NZD. A relative lull has formed on the market in the absence of important economic statistics that usually influence the value of currencies. The news background was weak.
On Monday we received data about the sentiment index of large manufacturers from Tankan, which grew to 22 pips, exceeding investors' expectations and achieving the highest level for many years. However, the pace of the growth of business activity in the service sector in Japan in September was the weakest over the past 11 months. A week earlier, the Japanese yen came under pressure because of the political situation in Japan, which negatively affected the value of the yen against most currencies.
The cost of the New Zealand currency fell this week due to a decreasing in the price of milk. In addition, the NZD was influenced by the situation in Australia. In September the volume of imports remained at the same level and the trade surplus increased, which is a negative factor for New Zealand. The value of the Australian dollar also dropped due to a decision of the RBA to leave interest rates unchanged.
Next week the feeble news background will persist for both currencies. The market is only expecting data on the business activity index PMI in New Zealand and on the volume of retail sales in New Zealand. In this situation, the best course would be the deals on the trend. This is also confirmed by the Stochastic oscillator.
