NZD/USD Rate Outlook Hinges on RBNZ Interest Rate Decision

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By :  ,  Strategist

New Zealand Dollar Outlook: NZD/USD

The Reserve Bank of New Zealand (RBNZ) interest rate decision may sway NZD/USD as the central bank is set to deliver its quarterly Monetary Policy Statement (MPS).

NZD/USD Rate Outlook Hinges on RBNZ Interest Rate Decision

NZD/USD trades near the monthly high (0.6035) to retain the advance following the better-than-expected New Zealand Employment report, which showed a 0.4% rise in the second quarter of 2024 versus forecasts for a 0.2% decline.

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It remains to be seen if the RBNZ will respond to the rise in employment as the central bank is expected to keep the official cash rate (OCR) at 5.50%, but the fresh forecasts from Governor Adrian Orr and Co. may influence the near-term outlook for NZD/USD should the central bank alter the forward guidance for monetary policy.

NZD/USD Price Chart – Daily

NZDUSD Daily Chart 08122024

Chart Prepared by David Song, Strategist; NZD/USD on TradingView

  • NZD/USD may further retrace the decline from the July high (0.6154) as the Relative Strength Index (RSI) continues to move away from oversold territory, with a break/close above 0.6070 (61.8% Fibonacci extension) raising the scope for a run at the July high (0.6154).
  • Next area of interest comes in around 0.6220 (50% Fibonacci extension) to 0.6270 (38.2% Fibonacci retracement) but failure to hold above the 0.5910 (61.8% Fibonacci extension) to 0.5960 (23.6% Fibonacci retracement) region may push NZD/USD back towards the monthly low (0.5850).
  • Next area of interest comes in around the November 2023 low (0.5789), with a breach below the 2023 low (0.5774) opening up the 0.5740 (78.6% Fibonacci retracement) to 0.5760 (100% Fibonacci extension) zone.

Additional Market Outlooks

GBP/USD Rebounds Ahead of July Low with UK Employment, CPI on Tap

Canadian Dollar Forecast: USD/CAD Flirts with 50-Day SMA

US Dollar Forecast: USD/JPY Continues to Defend January Low

Gold Price to Eye Monthly High on Failure to Close Below 50-Day SMA

--- Written by David Song, Strategist

Follow on Twitter at @DavidJSong

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