NZDUSD 1 Cent Down on Higher NZ Unemployment

The rate of USD to NZD saw some increased volatility yesterday, with employment earnings increasing in the USD while the unemployment rate increased in New Zealand, as last night’s report showed. The price was retreating higher last week but yesterday sellers came back at the 20 daily SMA and NZD/USD fell 100 pips lower, as fundamentals point down.

NZD/USD Chart Daily – MAs Are Keeping the Trend Bearish

Following another robust US inflation CPI report earlier this month, NZD/USD experienced a notable decline, as depicted in the Daily chart above. The pair eventually reached a crucial support zone around the 0.5860 level. Last week we saw a retreat in the USD after some mixed economic data, which don’t really change much but markets are getting scared on anything that comes out. However, the climb stopped right at the 20 daily SMA (gray), which seems to have turned into resistance on this chart.

The US employment costs/earnings index yesterday improved the situation for the USD, showing an increase in March, so we saw a reversal in this pair after the rejection at the 20 SMA. Then the New Zealand employment report came pretty weak this morning, so the decline continued and this forex pair is expected to fall below the support zone at 0.5860s.

New Zealand Q1 2024 Employment Report

RBNZ Comments Before Employment Figures

• New Zealand’s financial system remains robust as the economy adapts to higher interest rates.
• Global inflation is easing from high levels, and markets expect lower policy rates in the coming year.
• However, there’s a risk that ongoing or new inflationary pressures could lead to prolonged restrictive global interest rates, putting continued strain on households, businesses, and the financial system.

NZD/USD Live Chart