NZD/USD jumps above 0.64 despite below-forecast New Zealand consumer spending
- NZD/USD remains bid despite the dismal New Zealand consumer spending data.
- Markets expect the RBNZ to deliver a rate cut before the year-end.
- The PBOC kept interest rates unchanged at 4.20% earlier today.
The bid tone around the New Zealand Dollar remains strong, pushing the NZD/USD pair above 0.64 despite the weaker-than-expected New Zealand consumer spending data for September.
The annualized Credit Card Spending growth slowed to 4.8% in September from 6% in August. The market was expecting spending to rise to 5.1%. On a month-on-month basis, the spending fell 0.1%, having risen by an upwardly revised 2.5% in August.
The weaker-than-expected spending figures will likely bolster the dovish Reserve Bank of New Zealand (RBNZ) expectations.
The market expects the central bank to deliver an end-of-the-year rate cut, having stunned with a 50 basis point rate cut to 1% in August.
Even so, the NZD/USD pair is flashing green for the third straight day and looks set for a convincing move above 0.645 with key indicators like the 14-day relative strength index (RSI) reporting bullish conditions with an above-50 print for the first time since July.
It is worth noting that the People's Bank of China kept the one-year loan prime rate unchanged at 4.20%, contradicting expectations for a minor cut to 4.15%. So far, however, the NZD and other Commodity Dollars have shown resilience to PBOC's reluctance to cut rates.
Technical Levels
Author
Omkar Godbole
FXStreet Contributor
Omkar Godbole, editor and analyst, joined FXStreet after four years as a research analyst at several Indian brokerage companies.
