NZDUSD Analysis – December-27-2023

The New Zealand dollar recently soared to approximately $0.633, its highest point since July. This rise is largely thanks to the US’s slowing inflation, sparking speculations that the Federal Reserve may decrease interest rates in the upcoming year. As a result, commodity prices went up, positively affecting New Zealand’s currency.

In New Zealand, the central bank’s chief commented on the unexpected slump in recent economic growth. This has led many to believe the country might lower its cash rate sooner than expected. Despite previous hints from the Reserve Bank of New Zealand (RBNZ) about a potential rate hike to tackle stubborn inflation, market predictions now lean towards a rate cut as early as May. Last month, the RBNZ maintained the cash rate at 5.5%, though it was on the verge of increasing it.

NZDUSD Analysis – 4H Chart