Bears feeling lethargic – OCBC

The New Zealand Dollar (NZD) fell after RBNZ cut rate by 50bp. Pair was last at 0.6090, OCBC FX analysts Frances Cheung and Christopher Wong note.

Support comes in at 0.6060 and 0.60 levels

“MPC agreed that monthly price indices signal a continued decline in consumer price inflation. RBNZ also said that economic growth is weak, in part because of low productivity growth, but mostly due to weak consumer spending and business investment. These comments were well in line with what was earlier flagged in the NZIER’s quarterly survey of business opinions report.”

“Markets continue to expect about 50bp cut at the next MPC in Nov and another 100bp cut or so in 1H 2025. These were already priced in prior to the MPC. Dovish RBNZ may weigh on Kiwi for now but given that expectations are in the price, the downside for NZD may also be constrained.”

“Bearish momentum on daily chart intact while RSI is near oversold conditions. Support comes in at 0.6060 and 0.60 levels. Resistance at 0.61 (200 DMA), 0.6160 (50 DMA).”