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11 Jun 2014
NZD/USD players are mixed on the RBNZ outcome
FXStreet (Guatemala) - NZD/USD> is trading at 0.8562, up 0.44% on the day, having posted a daily high at 0.8576 and low at 0.8520.
NZD/USD has been a slow grind higher but has actually stolen 80 pips from the bears on the start of this week ahead of the RBNZ which comes immediately ahead and the consensus is largely expecting a 25bp hike by the RBNZ. Strategists at RBS explained that they are against the consensus looking for no change. “The RBNZ remains concerned about the strong currency and its potential pass-through to inflation, and first quarter inflation was softer than anticipated".
NZD/USD downside risks
The analysts at RBS continued, "At the same time, the RBNZ has noted that macroprudential measures have been more effective than anticipated in slowing the housing market, which may mean that the desire to hike interest rates to combat home price inflation has reduced. Dairy prices have fallen – the RBNZ noted this at their April meeting when they cautioned that dairy prices remain high but had fallen 20% from the peaks. Even in the event of a hike, we see the risks to the new forecasts and the signaling language as reflecting a more balanced, data dependent stance on monetary policy going forward. Thus, we see downside risks to NZD through the meeting”.
NZD/USD Levels
Current price is 0.8564, with resistance ahead at 0.8570 (Weekly Classic R1), 0.8576 (Daily High), 0.8578 (Daily Classic R3), 0.8640 (Weekly Classic R2) and 0.8668 (Monthly High). Next support to the downside can be found at 0.8553 (Daily Classic R2), 0.8547 (Hourly 20 EMA), 0.8540 (Daily Classic R1), 0.8529 (Yesterday's High) and 0.8526 (Daily Open).
NZD/USD has been a slow grind higher but has actually stolen 80 pips from the bears on the start of this week ahead of the RBNZ which comes immediately ahead and the consensus is largely expecting a 25bp hike by the RBNZ. Strategists at RBS explained that they are against the consensus looking for no change. “The RBNZ remains concerned about the strong currency and its potential pass-through to inflation, and first quarter inflation was softer than anticipated".
NZD/USD downside risks
The analysts at RBS continued, "At the same time, the RBNZ has noted that macroprudential measures have been more effective than anticipated in slowing the housing market, which may mean that the desire to hike interest rates to combat home price inflation has reduced. Dairy prices have fallen – the RBNZ noted this at their April meeting when they cautioned that dairy prices remain high but had fallen 20% from the peaks. Even in the event of a hike, we see the risks to the new forecasts and the signaling language as reflecting a more balanced, data dependent stance on monetary policy going forward. Thus, we see downside risks to NZD through the meeting”.
NZD/USD Levels
Current price is 0.8564, with resistance ahead at 0.8570 (Weekly Classic R1), 0.8576 (Daily High), 0.8578 (Daily Classic R3), 0.8640 (Weekly Classic R2) and 0.8668 (Monthly High). Next support to the downside can be found at 0.8553 (Daily Classic R2), 0.8547 (Hourly 20 EMA), 0.8540 (Daily Classic R1), 0.8529 (Yesterday's High) and 0.8526 (Daily Open).