NZDUSD at 0.60 Again Despite Lower RBNZ Inflation Expectations

The USD to NZD exchange rate is still volatile, with the NZDUSD pair being more optimistic than the other forex pairs.

Skerdian Meta•Thursday, August 8, 2024•1 min read

The USD to NZD exchange rate is still volatile, with the NZDUSD pair being more optimistic than the other forex pairs. Yesterday, this currency pair climbed above 0.60 after testing the support at the bottom, around 0.5850. But April’s low, which forms a support area around that zone, has held firm twice in the last two weeks, rejecting sellers once again.

New Zealand Quarterly Inflation Expectations Report

Following the reversal on Tuesday, the rally continued toward the descending 20-day moving average on the daily chart for NZD/USD . This moving average was breached yesterday and may now turn into support, especially if we see a soft unemployment claims report later today in the US session, as elevated FED rates have been impacting the labor market.

NZD/USD Chart Daily – The Price Has Moved Above the 20 SMA

Earlier today, we had the Inflation Expectations data from the Reserve Bank of New Zealand. This data release could add another layer of complexity to the pair’s movement. If inflation expectations are higher, it might suggest future rate hikes, which could strengthen the NZD. On the other hand, if expectations are lower, it could signal a dovish stance from the RBNZ, potentially weakening the NZD. The interplay between US labor market data and New Zealand’s inflation expectations will be critical in determining the short-term direction of this currency pair, so traders will be watching closely the Jobless Claims later today.

Reserve Bank of New Zealand 2-Year Inflation Expectations (Q3):
- Current: 2.03%, a decrease from the previous quarter’s 2.3%.
- Reflects a slight easing in medium-term inflation pressures, suggesting potential stabilization in the inflation outlook.
Reserve Bank of New Zealand 1-Year Inflation Expectations:
- Current: 2.4%, which indicates a shorter-term view of inflation slightly above the 2-year expectations.
- Highlights ongoing concerns about near-term inflationary pressures despite the overall downward trend.

NZD/USD Live Chart

NZD/USD

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Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.