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NZD/USD drops to 0.6110 on Kiwi Inflation, focus on US CPI data

  • NZD/USD loses ground as US Dollar improves ahead of US Inflation data.
  • RBNZ Inflation Expectations (Q1) increased by 2.5% against the 2.7% prior.
  • Annual US CPI and Core CPI could moderate to 2.9% and 3.7%, respectively.

The NZD/USD pair falls to near 0.6110 during the European trading session on Tuesday. The New Zealand Dollar (NZD) encounters pressure against the US Dollar (USD) is partially attributed to diminished Kiwi inflation expectations in the first quarter, as reflected in the RBNZ Inflation Expectations (QoQ) data, which rose by 2.5% but lower than the previous increase of 2.7%.

Economists at Commerzbank offer insights into the Kiwi's outlook, noting a significant decline in two-year inflation expectations to their lowest level since the third quarter of 2021. This places them just half a percentage point above the midpoint of the RBNZ's 1-3% inflation target range. However, given the prevailing trends in inflation and economic growth, it is deemed highly improbable for the RBNZ to raise rates again.

The US Dollar Index (DXY) maintains its upward trajectory for the second consecutive session, hovering around 104.10. However, the Greenback's ascent may be tempered by subdued US Treasury yields, with the 2-year and 10-year US yields at 4.47% and 4.17%, respectively, at present.

The NZD/USD pair receives downward pressure as traders exercise caution ahead of the release of United States (US) inflation data scheduled for Tuesday. Market experts anticipate the US Consumer Price Index (CPI) to moderate, with a year-on-year (YoY) increase of 2.9%, compared to the previous rise of 3.4%. The month-over-month rate is expected to stay consistent at 0.2%. Core CPI YoY could rise by 3.7%, down from the previous increase of 3.9%. The monthly core inflation is anticipated to be unchanged at 0.3%.

NZD/USD: additional important levels

Overview
Today last price0.6109
Today Daily Change-0.0023
Today Daily Change %-0.38
Today daily open0.6132
 
Trends
Daily SMA200.6108
Daily SMA500.6184
Daily SMA1000.6072
Daily SMA2000.6082
 
Levels
Previous Daily High0.6153
Previous Daily Low0.612
Previous Weekly High0.6159
Previous Weekly Low0.6037
Previous Monthly High0.6339
Previous Monthly Low0.6061
Daily Fibonacci 38.2%0.6133
Daily Fibonacci 61.8%0.614
Daily Pivot Point S10.6117
Daily Pivot Point S20.6102
Daily Pivot Point S30.6084
Daily Pivot Point R10.615
Daily Pivot Point R20.6168
Daily Pivot Point R30.6183

Author

Akhtar Faruqui

Akhtar Faruqui is a Forex Analyst based in New Delhi, India. With a keen eye for market trends and a passion for dissecting complex financial dynamics, he is dedicated to delivering accurate and insightful Forex news and analysis.

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