NZD/JPY soars to near 87.40 as RBNZ hikes its OCR by 75 bps

NZD/JPY has refreshed a two-week high at 87.40 as RBNZ has pushed interest rates to 4.25%.
The RBNZ has elevated its OCR by 75 bps after five consecutive 50 bps hikes.
Japanese markets are closed on account of Thanksgiving Day.

Sagar Dua FXStreet

The NZD/JPY pair has displayed a firm perpendicular move to 87.40 after a bigger rate hike announcement by the Reserve Bank of New Zealand (RBNZ). The New Zealand central bank has ditched the 50 basis points (bps) structure after deploying it consecutively five times. RBNZ Governor Adrian Orr has pushed the Official Cash Rate (OCR) to 4.25%.

The decision has remained in line with the expectations as a battle against a historic surge in inflationary pressures demands an extremely restrictive monetary policy. The inflation rate for the third quarter was recorded at 7.2%.

It seems that the unavailability of significant exhaustion signals in the price growth has forced the central bank to play with big chips. However, a significant hike in the OCR has left less room for more rate hikes, which will shift more responsibilities on economic dynamics to play ahead. The catalyst which has also led to a significant jump in the cross is the consideration of a 100 bps rate hike by RBNZ policymakers. An ‘extremely-hawkish’ stance considered by the central bank has infused fresh blood into the Kiwi Dollar.

Meanwhile, rising Covid-19 infections in China are still a major concern ahead. Economic projections for the dragon economy have been hit hard. This could impact the Kiwi Dollar, being the leading trading partner of China.

On the Tokyo front, investors are awaiting the release of the PMI numbers, which will release on Thursday. The Jibun Bank Manufacturing PMI is seen as stable at 50.7. While Services PMI is expected to decline marginally to 53.1. Investors should be aware that Japanese markets are closed on Wednesday on account of Thanksgiving Day.

NZD/JPY

Overview
Today last price	87
Today Daily Change	0.12
Today Daily Change %	0.14
Today daily open	86.88

Trends
Daily SMA20	86.03
Daily SMA50	84.48
Daily SMA100	84.79
Daily SMA200	83.92

Levels
Previous Daily High	87.04
Previous Daily Low	86.62
Previous Weekly High	86.74
Previous Weekly Low	84.67
Previous Monthly High	86.51
Previous Monthly Low	80.7
Daily Fibonacci 38.2%	86.88
Daily Fibonacci 61.8%	86.78
Daily Pivot Point S1	86.65
Daily Pivot Point S2	86.42
Daily Pivot Point S3	86.23
Daily Pivot Point R1	87.07
Daily Pivot Point R2	87.27
Daily Pivot Point R3	87.5

Author

Sagar Dua

FXStreet

Sagar Dua is associated with the financial markets from his college days. Along with pursuing post-graduation in Commerce in 2014, he started his markets training with chart analysis.

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