NZD/USD: headed to 0.7275 on the session ahead?
|Currently, NZD/USD is trading at 0.7358, down -0.09% on the day, having posted a daily high at 0.7366 and low at 0.7357.
RBNZ: searching for inflation - ANZ
NZD/USD was choppy in European trade before the dollar found some traction against the higher betas in early US. However, NZD/USD finished the day lower ahead of a blank calendar for today. The key focus is with the RBNZ this week. Analysts at Westpac expect the Reserve Bank will surprise markets with a dovish Monetary Policy Statement:
"Financial market pricing currently suggests that the OCR will begin rising from mid-2018, but the RBNZ has been sharply at odds with that view. The RBNZ sees the OCR as “on hold for the foreseeable future”, and is on the record saying it is equally likely that the next move in the OCR could be up or down.
Over the past few months there has been a run of soft data in New Zealand, including GDP, inflation, the housing market and building consents. At the same time, the exchange rate has risen to levels that the RBNZ will be finding uncomfortable. That said, we do not expect the Reserve Bank to make a big splash. The data has been soft, but the situation does not warrant the RBNZ altering its bottom-line guidance," explained the analysts at Westpac.
NZD/USD levels
"Further tests of support look possible today, and a break of 0.7340 opens up a move towards 0.7275," explained analysts at ANZ.
To the upside, 0.7370 (o/n high), 0.7420/25 ahead of the key 0.7440 and 0.7480 are the near-term resistance areas. 0.7520/25 double top highs are ahead of the 21st July high at 0.7557. In a continuation, 0.7744 were the April 2015 highs ahead of the opening highs for that year at 0.7889. To the downside, supports come as 0.7340/50 0.7280, (11th July high), 0.7205/06 June 22/21 lows; 0.7186 June 15 low; 0.7150 June 5 high; 0.7127 June 6 low. On the wide, on a break below 0.7080/00 opens 0.6970.
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