When is the RBNZ and how could it affect NZD/USD?
RBNZ overview
The RBNZ is expected to leave the Official Cash Rate (OCR) at 1.75% at its policy at the top of the hour while markets look for an upbeat assessment of the economy.
"A similar interest rate profile is likely (although at the margin the risks are perhaps that it is a touch lower)," analysts at ANZ explained.
How could the RBNZ affect NZD/USD?
“Foreign exchange markets may react to any comment about the exchange rate being too high, but interest rate markets are unlikely to be perturbed by a steady–as–she–goes MPS,” analysts at Westpac argued. NZD/USD lost the support of 0.7300 that was set in place during the European session and has since fallen with a strong greenback down to 0.7247 the low so far having been as high as 0.7352 after yesterday's strong NZ jobs data. 0.7200 was a previous support that if broken opens 0.7130 and 0.7070/80 (100 hourly SMA). On the upside, 0.7350 and 0.7430 are ket targets.
Key notes:
- RBNZ to lay as low as possible – TDS
- RBNZ to continue with its firmly neutral OCR outlook - Westpac
- RBNZ to keep OCR at 1.75%, retain cautiously upbeat stance - ANZ
About the RBNZ interest decision and statement
The RBNZ interest rate decision is announced by the Reserve Bank of New Zealand. If the RBNZ is hawkish about the inflationary outlook of the economy and raises the interest rates it is positive, or bullish, for the NZD. The RBNZ rate statement contains the explanations of their decision on interest rates and commentary about the economic conditions that influenced their decision.