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NZ jobs were soft

Will Today’s Soft Jobs Impact the RBNZ: NZD/USD

Posted Tuesday, November 5, 2019 by
Rowan Crosby • 1 min read

New Zealand has released its latest employment figures and given the soft number, there appears to still be some concerns around the state of the economy.

What that suggests is that the RBNZ might be looking at another rate cut thanks to the result from today.

The unemployment rate jumped from 3.9% to 4.2%. However, this was only a touch above the expected 4.1%, depending on what source you’re using.

That has seen the odds of a rate cut climb to around 60% up from about 55% at the start of the session.

The latest indication from the RBNZ was that it has no set plan. That of course, comes on the back of some massive cuts this year.

So the RBNZ are certainly not afraid to pull the trigger here if they think that’s what the economy needs.

Interestingly though, the NZD/USD is slightly higher if anything. So far price is up around 0.14% but the reaction hasn’t been big.

Price has been struggling to push any higher lately and is trapped under the 0.6400 level. On the charts, it does look like price is making a bit of a head and shoulders even on H4 time frame.

Just yesterday, we heard from the RBA who are also in a wait and see type of situation. If anything they seem a little more bullish and have at least had the benefit of a downtick in the jobless rate.

So for the time being, the Kiwi will be in focus as we head into the next RBNZ meeting on November 13.

While there is no expectation of a cut, those odds are creeping higher.

Given today’s results, looking for shorts under that 0.6400, is not a bad trade at the moment.

NZD/USD
NZD/USD – 240min.
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