NZD/USD Falls to a 6-month Low - 9 May 2019

The New Zealand dollar has fallen nearly 1.0% since the start of trading this week. Its biggest losses were after the Reserve Bank of New Zealand's surprise announcement of a rate cut, prompting the NZD / USD to fall to the 0.6524 low level since late October, and settled around 0.6575 in early Thursday. US data ahead are weekly jobless claims, trade balance, PPI and comments by Federal Reserve Governor Jerome Powell. On the daily chart, the pair is still moving within a stronger bearish channel and will be supported by the Reserve Bank of New Zealand's decision.

The Reserve Bank of Australia challenged expectations and maintained interest rates, and the surprise was the Reserve Bank of New Zealand, which unexpectedly cut interest rates by 25 basis points. This was the first interest rate cut since November 2016. The Reserve Bank of New Zealand issued a statement on interest rate policy and was cautious, saying the rate cut was necessary to boost employment and inflation expectations. Monetary policymakers noted that the bank's announcement came on the back of uncertainties about the global economy and that global and domestic economic growth had slowed since mid-2018, weakening New Zealand's economy. The interest rate cut "provides a more balanced view of interest rates," the statement said.

Kiwi trouble this week has been fueled by rising trade tensions between China and the United States, especially as US President Trump announced that the United States would raise tariffs on Chinese goods worth $ 200 billion early on Friday, from 10 percent to 25 percent. Chinese officials said they would cancel the talks, but it turned out to be an empty threat. Where Chinese Vice Premier Liu He is scheduled to lead a Chinese delegation to Washington. In turn, Treasury Secretary Steve Munchin said customs duties could be canceled when talks resumed. Such a move would start to stimulate risk, which would be positive for the New Zealand dollar.

The most important support for the New Zealand against the U.S Dollar today: 0.6545, 0.6480 and 0.6400 respectively.

The most important resistance levels for the New Zealand against the U.S Dollar today: 0.6620, 0.6700 and 0.6775, respectively.

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DailyForex.com Team
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