NZD/USD resting on the 200-D SMA

NZD ranged between 0.6840 and 0.6880 following yesterday's half-year economic and fiscal outlook (HYEFO), where FinMin Grant Robertson announced a string of fiscal surpluses, where revenue strength is more than funding upgraded spending plans. 

The report suggests that New Zealand has achieved maximum sustainable employment and inflation and inflation expectations are well anchored at 2%. "While we are of the view that this combination means the OCR does not need to remain on the floor at 1.75%, the RBNZ under Governor Adrian Orr is determined not to hike for the next two years. The 'soft' housing market has already triggered another round of looser LVR restriction," analysts at TD Securities explained. 

Markets lacking a catalyst

Meanwhile, in markets today, they have been trading within small ranges without much in the way of catalysts, following the ECB announcement where a dovish tone was observed. We also had mixed signals over Sino/China trade relations even while China resumed soybean purchases from the US, although detained another Canadian citizen for questioning which left a dark cloud over prospects of a synergised pact to work towards a deal before the start of March's cut off. This left risk appetite and US equities mixed. 

"Another session where familiar ranges have held, and that looks unlikely to change much today. Global forces are in the box seat, but kiwi has struggled to make much progress north of 69 cents," analysts at ANZ argued. 

NZD/USD levels

• Support 0.6820 
• Resistance 0.6980

The bird is holding above the 200-D SMA located at 0.6849 and a break below risks a slide to the 38.2% retracement Fibo (at 0.6810). On the downside, 0.6825 was the recent low ahead of S3 at 0.6746. On a break higehr, the bird can head towards the 61.8% Fibo at 0.7048.