NZD/USD on the bids to 0.6330 after upbeat New Zealand GDP
- NZD/USD recovered some of the latest losses after NZ GDP beat forecasts.
- New Zealand’s (NZ) Q2 GDP nears RBNZ’s forecast while rising to 0.5% and 2.1% on QoQ and YoY basis respectively.
- Aussie employment data, trade headlines, and the US statistics will be in the spotlight for now.
With the second quarter (Q2) New Zealand Gross Domestic Product (GDP) beating market expectations, NZD/USD flashes intraday high of 0.6332 during early Asian morning on Thursday.
The GDP figures neared the Reserve Bank of New Zealand’s (RBNZ) forecast while flashing 0.5% QoQ growth, versus 0.4% anticipated, and also beating 2.0% yearly expectations with 2.1% mark. Markets cheer the data release by propelling the Kiwi pair to the north.
The Kiwi pair slumped on Wednesday after the US Dollar (USD) registered across the board strength even after the US Federal Reserve’s 0.25% rate cut. The market put heavy emphasis on the Fed’s dot-plot signaling no more rate cuts in 2019 and difference of opinion among the policymakers while preferring the greenback over the other currencies.
Trade headlines have been positive with US-China diplomats up for establishing the first contact after the spat while Japanese Foreign Minister expecting the US to be clear on autos before signing final trade deal at the month-end.
With the growth figures meeting the RBNZ’s forecast and beating market expectations, investors will now focus on the employment data from largest customer Australia while also keeping an eye over the trade/political headlines and the US economic calendar for fresh impulse.
Technical Analysis
21-day simple moving average (SMA) level around 0.6365 acts as an immediate upside barrier, a break of which can trigger fresh advances targeting 0.6400 and then towards the monthly top surrounding 0.6450. Meanwhile, monthly bottom surrounding 0.6270 holds the key to pair’s further declines towards a downward-sloping trend-line connecting May 2017 lows and October 2018 bottom, around 0.6170.