FxNews—The NZD/USD pair slipped below the August 5 low at $0.585, even though the country’s economic data was better than expected.
New Zealand Producer Prices Rise Faster Than Expected
For instance, producer output prices in New Zealand increased by 1.5% compared to last year and rose by 1.9% from the previous quarter ending in September. These figures were higher than what experts had predicted and showed faster growth than before.
Moreover, the services sector performance index in New Zealand improved slightly. It went up to 46 in October from 45.7 in September. Although this number is still below 50—which means the sector is contracting—it indicates that the contraction is slowing down.
Expectations Grow for New Zealand Central Bank Rate Cut
This data comes just before the Reserve Bank of New Zealand announces its monetary policy decision next week. Many expect the bank to cut interest rates by another 50 basis points, following a similar cut in October.
Meanwhile, the New Zealand dollar remained under pressure because the U.S. dollar was strong. The strength of the U.S. dollar is due to solid economic data from the United States and comments from Federal Reserve Chair Powell suggesting that interest rates may stay high.
NZDUSD Technical Analysis – 18-November-2024
The NZD/USD currency pair trades in a bear market, below the 100-period simple moving average. Today, the bears pushed the prices below the August 4 low at $0.585, which can escalate the downtrend.
The immediate resistance is at $0.581, and the outlook of the NZD/USD trend will remain bearish if the prices are below $0.981. In this scenario, the bears will likely target the October 2024 low at $0.577.
Please note that the bearish outlook should be invalidated if the AUD/USD price exceeds the immediate resistance at 0.581.