06 May 2021 03:18
«New Zealand Dollar vs Czech Koruna» or «NZDCZK»
NZD/CZK is not among popular currency pairs on Forex. NZD/CZK is the cross rate against the US dollar. Although the US dollar obviously is not present in this currency pair, it still has a considerable influence on it. This can be observed if you combine two charts of NZD/USD and USD/CHK currency pairs. Thus, you can get an approximate NZD/CZK chart.
The US dollar has a significant impact on both currencies. For this reason it is necessary to take into account the major US economic indicators in order to predict correctly a future course of this financial instrument. These indicators are as follows: the discount rate, GDP, unemployment rate, Non-Farm Payrolls, etc. It is necessary to note that discussed currencies could respond with different speed to changes in the US economy. Therefore, the NZD/CZK currency pair may be a specific indicator of the fluctuations of these currencies.
Operating with the NZDCZK trading instrument, it is necessary to take into account many features of the New Zealand economy, such as GDP, the discount rate, economic activity, trade with other countries, etc. New Zealand is one of the world's largest producer of wool and wool products. It should be noted that New Zealand's economy is highly dependent on its main partners - the US, Asian and Oceania countries. For this reason, you should also take into account a variety of economic indicators of main trading partners of New Zealand.
The Czech Republic is one of the most advanced industrialized countries of central Europe. The country is one of the most prosperous and stable among all the countries of the region. Czech Republic has a high rate of personal income, due to a high level of economic development.
The main sectors of Czech Republic economy are: engineering, iron and steel production, chemical industry, electronics, brewing, and agriculture. The most developed economic sector is the automotive industry. Czech Republic has one of the world’s highest rates of car production, most of them are exported. In addition, the Czech Republic is one of the leading exporters of beer and shoes. In addition, significant portion of Czech export is derived from chemical industry: tires, synthetic fibers, etc. The main trade partners of the Czech Republic are Germany, Russia, Slovakia, and Austria. The Czech Republic is one of the leaders in Europe in sphere of electricity production, due to the presence in this country a wide range of possibilities to produce the electric power: nuclear, thermal, hydro, solar, and wind power.
This trading instrument is relatively illiquid if we compare it with major currency pairs, such as: EUR/USD, USD/CHF, GBP/USD, and USD/JPY. Therefore, when you make a forecast for the financial instrument, you should primarily focus on those currency pairs that include the US dollar along with each of the considered currencies.
If you trade cross rates, it is necessary to remember that brokers usually set a higher spread than on the more popular currency pairs, so before you start working with the cross rates, one should thoroughly read and understand the conditions offered by a broker to trade with the specified trading instrument.