- RBNZ says financial system risks remain elevated.
- US Dollar Index consolidates this week’s gains above 98.
- Coming up: US first-quarter GDP growth (second estimate).
Following a muted reaction to the Reserve Bank of New Zealand’s Financial Stability Report, the NZD/USD pair spent the first half of the day moving sideways in a tight range above the 0.65 handle before posting modest gains ahead of the NA session. As of writing, the pair was trading at 0.6522, adding 0.17% on a daily basis.
“The financial system remains resilient to a broad range of economic risks that remain elevated and ongoing effort is necessary to bolster soundness and efficiency in the system,” the RBNZ noted in its FSR. Commenting on the publication, “The May 2019 Financial Stability Report provided few surprises, with loan-to-value ratio (LVR) restrictions left unchanged as the Bank assesses the effects of previous easing and mortgage rate falls,” said ANZ analysts.
According to the latest headlines surrounding the U.S.-China trade conflict, China has halted its soy purchases from the U.S. Meanwhile, China’s Ministry of Commerce (MOFCOM) in a statement argued that the U.S. consumer would have to pay the costs of tariffs.
In the second half of the day, the U.S. Bureau of Economic Analysis will be publishing its second estimate of the first-quarter GDP growth. Other data releases from the U.S. will include goods trade balance and weekly initial jobless claims. Ahead of the data, the US Dollar Index is virtually unchanged on a daily basis at 98.15.
Technical levels to consider
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