RBNZ left Official Cash Rate unchanged at 1.50% as widely expected. It also adopted an easing bias by repeatedly saying ” a lower OCR may be needed”. It’s taken by a strong signal that another rate cut is underway in August. However, on the brighter side, RBNZ noted that “GDP growth had held up more than projected” in Q1. And “some of the factors supporting growth in the quarter would continue.” Also, while risks are “tilted to the downside”, resolution of trade tensions “could see uncertainty ease”.
New Zealand Dollar spiked lower after the release by quickly rebounded on the positive references.
Some suggested readings:
- Review Of The RBNZ’s June OCR Review: Hinting Strongly
- RBNZ Holds But Keeps Door Open For A Cut In August | GBP/NZD, EUR/NZD
At this point, NZD/USD is staying in consolidation from 0.6481 and more sideway trading could be seen. But with 0.6681 resistance intact, further decline is expected through 0.6481 support to 0.6424. Decisive break there will resume larger down trend form 0.7557 to 0.6102 (2015 low). However, firm break of 0.6681 will extend the consolidation pattern fro 0.6424 with another rising leg, towards 0.6969 resistance, before completion and down trend resumption.
