NZD/USD Plunges as RBNZ Cuts Interest Rate

FXOpen

The New Zealand Dollar (NZD) fell sharply against the US Dollar (USD) yesterday, dragging the price of NZDUSD to less than 0.7250 following the Reserve Bank of New Zealand (RBNZ) decision to cut the benchmark interest rate by 0.25% to 2%. The technical bias, however, remains bullish because of a Higher High in the recent upside rally.

Technical Analysis

As of this writing, the pair is being traded near 0.7201. A hurdle may be noted around 0.7342, the intraday high of yesterday ahead of 0.7744, the major horizontal resistance area. A break and daily closing above the 0.7744 resistance shall expedite the bullish momentum, validating a rally towards the 0.8000 milestone.

NZD/USD Plunges as RBNZ Cuts Interest Rate

On the downside, the pair is likely to find a support around 0.7086-0.7100, the confluence of a horizontal support as well as the psychological number ahead of 0.6951, the swing low of the latest major downside move. The technical bias will remain bullish as long as the 0.6951 support area remains intact.

RBNZ Cuts Rate

New Zealand is the latest developed economy to join the low rates club with its central bank cutting the benchmark rate by 0.25 per cent to 2 per cent. The Reserve Bank of New Zealand (RBNZ) met market expectations by delivering the rate cut and flagged that more monetary policy easing might be needed.

Echoing concerns of Australia’s Reserve Bank, Mr Wheeler said the New Zealand currency was being pushed uncomfortably high as investors search for yield in a low rates world. “The high exchange rate is adding further pressure to the export and import competing sectors,” Mr Wheeler observed in his statement.

Trade Idea

Considering the overall technical and fundamental outlook, selling the pair around the current levels appears to be a good strategy in short to medium term.

Trade over 50 forex markets 24 hours a day with FXOpen. Take advantage of low commissions, deep liquidity, and spreads from 0.0 pips. Open your FXOpen account now or learn more about trading forex with FXOpen.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Stay ahead of the market!

Subscribe now to our mailing list and receive the latest market news and insights delivered directly to your inbox.

forex

Forex Trading with FXOpen

Forex Trading with FXOpen

Experience ECN technology for deep liquidity and light-speed trade execution

  • Access over 50 markets
  • Trade with spreads from 0.0 pips
  • Take advantage of commissions from $1.50/lot
Learn more

Latest articles

Shares

UnitedHealth (UNH) Share Price Plummets

UnitedHealth shares crashed by nearly 23% yesterday after the healthcare giant reported weaker-than-expected Q1 2025 results:

→ Earnings per share: actual = $7.20, expected = $7.29
→ Revenue: actual = $109.5bn, expected = $111.5bn

Technical Analysis of UNH Share Chart

As far

Indices

Stock Markets Consolidate Ahead of the Holidays

A lull is expected on the financial markets today due to a shortened trading week related to the Easter holiday celebrations.

It is reasonable to assume that traders will get a “breather” after a news-heavy April, which caused a volatile

Forex Analysis

The Pound and Euro Reach New Yearly Highs

Despite global economic instability and Donald Trump’s tariff policy, the EUR/USD and GBP/USD currency pairs are demonstrating upward momentum, reaching new yearly highs.

Today, market participants are focused on the European Central Bank meeting, where significant statements

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.