NZD/USD slips ahead of GDP, Fed meetingThe New Zealand dollar is sharply lower in Wednesday trade. In the European session, NZD/USD is trading at 0.6095, down 0.61%.
US inflation ticked lower in October as expected and the release was a non-event for the markets, which slightly reduced their rate-cut pricing. Headline CPI climbed 3.1% year-on-year in November, down from 3.2% in October and in line with the market estimate of 3.1%. Core CPI, which is considered a more reliable gauge of inflation trends, climbed 4.0% year-on year in November, unchanged from October. This matched the market estimate of 4.0%.
On a monthly basis, both CPI and Core CPI ticked higher. CPI came in at 0.1%, up from 0.0% in October and the core rate also rose from 0.2% to 0.3%. Both readings matched the market estimates. A decline in gasoline prices helped pull down inflation. However, a wide range of goods and services experienced price increases, suggesting that underlying inflation remains sticky.
Today's FOMC meeting could provide clues as to what the Fed has in mind in the New Year. The markets have priced in a pause today at close to 100%, so the focus will be the rate statement and Jerome Powell's post-meeting press conference. If Powell is hawkish and pushes back against rate cuts, it could force the market to again reduce rate cut expectations.
New Zealand releases GDP for the third quarter on Thursday, with expectations for a weak gain of 0.2% q/q, compared to a sharp gain in Q2 of 0.9%. On an annualized basis, the market consensus stands at 0.5%, following a 1.8% gain in the second quarter. An unexpected reading could have a strong impact on the direction of the New Zealand dollar.
NZD/USD is putting pressure on support at 0.6076. Below, there is support at 0.6031
There is resistance at 0.6150 and 0.6195
Nzsdusd
Downside Correction on weekly base towards Support 0.6580$Yesterday's fall led to the formation of the "absorption" pattern of the daily level. The downward movement will aim to return to the upper limit of the average move of the previous week, located at the level of 0.6740/50$
Price hit back to resistance and expecting coming days correction downside If price closed below 0.6760/80$, the target of the decline will be the weekly short-term price of 0.6636-0.6621. A test of this zone will cause the price to go more downside towards support 0.6520$
🛑SUPPORT/RESISTANCE
✅S1= 0.6650
✅S2=0.6530
✴️R1=0.6760
✴️R2=0.6820
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