- NZD/USD rallies more than 50 pips after RBNZ turned down market expectations.
- Expectations of a 0.25% rate cut surged after Tuesday’s RBNZ Inflation data.
- Governor Orr’s press conference will be the key to watch for now.
RBNZ again surprises global markets, this time positively, while turning down the expectations of a rate cut, which in turn propels NZD/USD to 0.6420 during early Wednesday.
The Reserve Bank of New Zealand (RBNZ) announced no change to its 1.0% Official Cash Rate (OCR) as a part of its November month monetary policy meeting decision.
Risk tone has been sluggish off-late as the market’s failure to gain any clear signal concerning the much-awaited trade deal between the United States (US) and China keep traders away. The latest headlines signal that the US diplomats, including President Donald Trump, keep reiterating nearness to a deal while the Wall Street Journal states otherwise considering the absence of the US commitment to remove existing tariffs on China.
On the other hand, the US Justice Department recently conveyed that a Chinese national, Hongjin Tan, pleads guilty for stealing information from the US-based petroleum company concerning the research and development downstream energy market product that is worth more than $1 billion.
That said, that market’s risk barometer, the US 10-year treasury yields and stocks, continue signaling a lack of trading interest.
Investors will now focus on the RBNZ Governor Adrian Orr’s press conference, at 02:00 GMT, for predicting the kiwi pair’s near-term direction. In doing so, clues for the central bank’s future rate actions will be closely observed.
Technical Analysis
Buyers will prefer waiting for pair’s daily closing beyond 100-day EMA level of 0.6427 for big positions. Alternatively, short-term rising support trend line around 0.6290 can stop sellers targeting October 16 low of 0.6240.
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