From InvestorsObserver: 2024-05-19 03:59:00

The NZD/USD exchange rate is set to be impacted by the upcoming Reserve Bank of New Zealand (RBNZ) interest rate decision. The pair has been on a strong upward trend, surging from 0.5852 to near 0.6150, its highest level since March 14th. This surge was partly driven by weak US economic data.

The US dollar index (DXY) plummeted last week due to weak economic numbers, including sluggish retail sales and manufacturing data. This, coupled with high inflation and slow economic growth, could prompt the Fed to make interest rate cuts. The NZD/USD exchange rate is likely to see further movement after the RBNZ interest rate decision on Wednesday.

Recent data from New Zealand shows elevated inflation levels and a recovering economy. Despite a slight contraction in Q4 2023, analysts predict the RBNZ will keep interest rates unchanged in their upcoming decision and may even hint at a rate cut later in the year. This decision comes as the headline consumer inflation rate dropped to 4.0% in Q1.

Technical analysis of the NZD/USD exchange rate reveals a strong bull run and a break above key resistance levels. The pair has surpassed the 50-day and 100-day EMAs, as well as the first resistance level on the woodie pivot point. The RSI and RVI indicators also show strong bullish momentum, indicating a potential retest of 0.6157 before a pullback to 0.6080 post-RBNZ decision.



Read more at InvestorsObserver: NZD/USD forecast and RBNZ interest rate decision preview