NZD/USD jumps above 0.64 despite below-forecast New Zealand consumer spending
- NZD/USD remains bid despite the dismal New Zealand consumer spending data.
- Markets expect the RBNZ to deliver a rate cut before the year-end.
- The PBOC kept interest rates unchanged at 4.20% earlier today.
The bid tone around the New Zealand Dollar remains strong, pushing the NZD/USD pair above 0.64 despite the weaker-than-expected New Zealand consumer spending data for September.
The annualized Credit Card Spending growth slowed to 4.8% in September from 6% in August. The market was expecting spending to rise to 5.1%. On a month-on-month basis, the spending fell 0.1%, having risen by an upwardly revised 2.5% in August.
The weaker-than-expected spending figures will likely bolster the dovish Reserve Bank of New Zealand (RBNZ) expectations.
The market expects the central bank to deliver an end-of-the-year rate cut, having stunned with a 50 basis point rate cut to 1% in August.
Even so, the NZD/USD pair is flashing green for the third straight day and looks set for a convincing move above 0.645 with key indicators like the 14-day relative strength index (RSI) reporting bullish conditions with an above-50 print for the first time since July.
It is worth noting that the People's Bank of China kept the one-year loan prime rate unchanged at 4.20%, contradicting expectations for a minor cut to 4.15%. So far, however, the NZD and other Commodity Dollars have shown resilience to PBOC's reluctance to cut rates.
Technical Levels