New Zealand Cash Rate will define the fate of NZD!
Reserve Bank of New Zealand (RBNZ) will reveal Official Cash Rate and make a statement about monetary policy on October 6, 04:00 GMT+3.
What do analysts expect from the NZD today?
Last week was bullish for the New Zealand dollar. The currency strengthened amid the market optimism surrounding the US-China phase one trade deal. Today we will see the release of GDP growth of New Zealand for the third quarter at 23:45 MT time. The important economic data may excite traders.
Why is it important?
As you may know, the indicator of GDP growth stands for the gross domestic product of a country. It represents the inflation-adjusted value of all goods and services produced by the economy. The central bank uses this indicator to measure the economic health of a country. Wednesday’s release may affect the RBNZ decision, as the bank is assessing its further moves. After surprisingly keeping the interest rates on hold during the November’s meeting, the possibility of a rate cut during the next meeting remained. However, the positive data may change the mind of the regulator.
What are the analysts’ expectations?
Recently, New Zealand banks raised their projections for Q3 economic growth.
ASB raised it from 0.7% to 0.5%, while BNZ increased it from 0.3% to 0.5%, citing a better manufacturing data.
The survey of economists by Reuters also shows the expectation of a rise to 0.6%.
If the actual level of indicator is higher than the forecasts, it will have a positive impact on the New Zealand dollar.
Key levels for NZD/USD
The 50-week SMA combined with the 0.66 level appeared to be too tough for buyers of NZD/USD. On the daily chart, the pair bounced from the 0.66 resistance level and moved down to the 0.6540 support, which lies close to the 200-day SMA.
On H4, bulls are testing the resistance at 0.6574 (50-period SMA). If the NZD is supported today by the positive data, we may expect the breakout of this level and rise towards 0.66. Otherwise, we may see the reversal towards 0.6550. In case of a breakout of this level, bears will target 100-period SMA at 0.6522.
Key levels for NZD/JPY
NZD/JPY has been trading at its July highs. On H4, the price has been trading within an uptrend, which is well supported by the 50-period SMA. The retest of a trendline may be attractive for opening a long position. If bulls push the pair higher, the chance of reaching the 72.2 level will increase. Key levels from the downside will lie at 71.7-71.87.
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