NZD/USD inches closer to 0.6100 after fresh stimulus from New Zealand
- NZD/USD holds onto recovery gains after the New Zealand government releases further measures to counter coronavirus.
- The 12.1 billion New Zealand dollar package follows RBNZ’s rate cut the previous day.
- The Finance minister cites fears of a recession, eyes on the US data, COVID-19 headlines for fresh impulse.
NZD/USD rises to 0.6070, up 0.40%, following the high of 0.6096 as the New Zealand government announced details of its stimulus during the Asian session on Tuesday. The government allocated nearly 4.0% of the GDP to counter the negative implications of the coronavirus (COVID-19) after the RBNZ’s rate cut the previous day.
Read: New Zealand announces nz$12.1 bln economic package in response to COVID-19
In addition to offering the details of the plan, New Zealand’s Finance Minister also cites fears of a recession, job losses and an increase in debts.
Even so, the market’s risk-tone remains on the recovery mode as the US 10-year treasury yields remain on the front foot around 0.785% while S&P 500 Futures register close to 4.0% gains after declining heavily on Monday.
Earlier during the day, New Zealand Westpac Consumer Survey data for the first quarter (Q1) came in below 109.9 to 104.20. Further, it should also be noted that the RBNZ surprised global markets with a 0.75% rate cut the previous day.
Looking forward, the US Retail Sales for November and the virus updates will be the key to forecast near-term market direction.
Technical Analysis
Any update beyond October 2019 low near 0.6200 is less likely to lure the buyers. On the contrary, sellers can take entry if the prices slip below 0.6000 mark.
Author
Anil Panchal
FXStreet
Anil Panchal has nearly 15 years of experience in tracking financial markets. With a keen interest in macroeconomics, Anil aptly tracks global news/updates and stays well-informed about the global financial moves and their implications.
