- The NZD/USD rose to its highest level since late May, above the 20-day SMA at 0.6130.
- ANZ predicts next week New Zealand GDP data will come in mixed.
- NZD/USD to close a second consecutive week of gains.
The NZD/USD currency pair has recently surged to its highest level since May, surpassing the 20-day Simple Moving Average (SMA) at 0.6130. The Greenback’s losses for the next sessions could be limited by hawkish bets for the upcoming Federal Reserve (Fed) meeting past June, as recent development made investors foresee fewer odds of a rate cut by year-end.
Fed expectations remain steady for next week, but later rate cut bets decrease
Ahead of the upcoming Federal Reserve (Fed) June 13-14 meeting, the CME FedWatch Tool suggests that investors are placing higher probabilities on the Fed refraining from hiking rates and, instead, keeping the target rate steady at 5.00%-5.25%. However, the bets for a hike in July stand almost priced in at 85% and the odds of a rate cut by years-end decreased from 50% at the start of the week to nearly 15% due to the recent unexpected hikes by the Reserve Bank of Australia (RBA) and the Bank of Canada (BoC). In that sense, a more hawkish stance by the Fed provides support for the USD.
On the other hand, following NZ Q1 Gross Domestic Product (GDP) data release, ANZ Bank is expecting next week to see “tepid” growth and an improvement from the current account deficit.
NZD/USD levels to watch
Technically speaking, the NZD/USD exchange rate holds a neutral to bullish outlook for the short term as daily indicators show that bulls continue to get momentum. However, the pair needs to consolidate above the 20-day SMA in order to confirm a recovery. On the weekly chart, the pair is poised to confirm a second consecutive week of gains.
A consolidation above the 20-day Simple Moving Average at 0.6130 would suggest a continuation of the momentum towards the 200-day SMA at 0.6150 and then to the 0.6200 area. On the other hand, the 0.6090 area is the immediate support level for NZD/USD. A break below could pave the way towards the 0.6050 and 0.6030 zones.
NZD/USD daily chart
-638219248670505513.png)
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended content
Editors’ Picks
EUR/USD holds gains above 1.0700, as key US data loom
EUR/USD holds gains above 1.0700 in the European session on Thursday. Renewed US Dollar weakness offsets the risk-off market environment, supporting the pair ahead of the key US GDP and PCE inflation data.
GBP/USD extends recovery above 1.2500, awaits US GDP data
GBP/USD is catching a fresh bid wave, rising above 1.2500 in European trading on Thursday. The US Dollar resumes its corrective downside, as traders resort to repositioning ahead of the high-impact US advance GDP data for the first quarter.
Gold price edges higher amid weaker USD and softer risk tone, focus remains on US GDP
Gold price (XAU/USD) attracts some dip-buying in the vicinity of the $2,300 mark on Thursday and for now, seems to have snapped a three-day losing streak, though the upside potential seems limited.
XRP extends its decline, crypto experts comment on Ripple stablecoin and benefits for XRP Ledger
Ripple extends decline to $0.52 on Thursday, wipes out weekly gains. Crypto expert asks Ripple CTO how the stablecoin will benefit the XRP Ledger and native token XRP.
US Q1 GDP Preview: Economic growth set to remain firm in, albeit easing from Q4
The United States Gross Domestic Product (GDP) is seen expanding at an annualized rate of 2.5% in Q1. The current resilience of the US economy bolsters the case for a soft landing.