- Kiwi dropped beneath 0.6700 as inflation paves the way for RBNZ’s rate-cut in May.
- China data will be in focus for antipodeans for now.
The NZD/USD pair trades near 0.6700 on early Wednesday after the headline New Zealand inflation figure disappointed Kiwi buyers.
The headline consumer price index (CPI) declines to 0.1% versus 0.3% market expectations on a QoQ basis while lagging behind consensus to 1.5% on yearly formate.
With the GDT price index from New Zealand coming in better than expected -0.5% to +0.5%, Kiwi traders lined up for buying the currency ahead of the headline inflation data.
The Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr said in his interview on Tuesday that the Kiwi is in “happy space” and bearish bias remains in play. He also said that possibility Q1 inflation undershooting forecasts already factored into bank's dovish bias.
Traders also emphasized on the US industrial production growth missing +0.2% market consensus and coming in at -0.1%.
China’s data-dump including March month industrial production and retail sales, coupled with first quarter (Q1) gross domestic product (GDP), will be on the spotlight of antipodeans for now. The GDP figure might soften to 6.3% from 6.4% on YoY and to 1.4% from 1.5% on a quarterly basis whereas the retail sales (YoY) could rise to 8.4% from 8.2%. Also, industrial production (YoY) bear expectations of an uptick to 5.9% from 5.3%.
NZD/USD Technical Analysis
Not only 0.6730 but 0.6805-10 resistance-confluence comprising 50-day and 100-day simple moving average (SMA) and 0.6835-40 area also become important resistance for the pair.
On the downside, a sustained break of 0.6700 is required for the pair to aim for 0.6650 support mark that holds the gate for its downturn towards 0.6585.
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