NZD/USD Price Forecast: Aims to revisit 0.6100 in countdown to RBNZ policy
- NZD/USD edges higher to near 0.6040 as the NZD rises ahead of the RBNZ monetary policy.
- The RBNZ is expected to leave its OCR unchanged at 2.25% on Wednesday.
- Investors await the FOMC Minutes and the flash Q4 GDP data.
The NZD/USD pair trades marginally higher to near 0.6040 during the European trading session on Tuesday. The Kiwi pair edges up as the New Zealand Dollar (NZD) ticks higher ahead of the announcement of the Reserve Bank of New Zealand’s (RBNZ) interest rate policy on Wednesday.
Investors expect the RBNZ to hold its Official Cash Rate (OCR) steady at 2.25%, which puts interest rate guidance from the New Zealand (NZ) central bank under the spotlight. Analysts at ING expect the RBNZ to deliver two interest rate hikes in the third quarter this year.
Hawkish RBNZ expectations are driven by rising inflationary pressures in the economy. In the last quarter of 2025, Consumer Price Index (CPI) grew at a faster pace of 3.1% on an annualized basis against the previous release of 3%.
Meanwhile, the US Dollar (USD) trades flat ahead of the opening of the United States (US) markets after an extended weekend. As of writing, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, flattens around 97.00.
This week, major triggers for the US Dollar will be the release of Federal Open Market Committee (FOMC) Minutes and the preliminary Gross Domestic Product (GDP) data.
NZD/USD technical analysis
-1771322004973-1771322004977.png)
In the daily chart, NZD/USD trades at 0.6039. The pair holds above a rising 20-day exponential moving average at 0.5991, keeping the short-term trend pointed higher. The average has been grinding upward in recent sessions and now underpins the advance. RSI stands at 62 (bullish) and is firming, endorsing upward momentum without overbought pressure.
Momentum has normalized after an earlier overbought spike and now stabilizes with RSI comfortably above the 50 midline. As long as daily closes remain above the 20-day EMA, buyers would retain the initiative, while a decisive close below that gauge would tilt the setup toward consolidation; a push in RSI toward 70 would signal an acceleration of the uptrend.
(The technical analysis of this story was written with the help of an AI tool.)
RBNZ FAQs
The Reserve Bank of New Zealand (RBNZ) is the country’s central bank. Its economic objectives are achieving and maintaining price stability – achieved when inflation, measured by the Consumer Price Index (CPI), falls within the band of between 1% and 3% – and supporting maximum sustainable employment.
The Reserve Bank of New Zealand’s (RBNZ) Monetary Policy Committee (MPC) decides the appropriate level of the Official Cash Rate (OCR) according to its objectives. When inflation is above target, the bank will attempt to tame it by raising its key OCR, making it more expensive for households and businesses to borrow money and thus cooling the economy. Higher interest rates are generally positive for the New Zealand Dollar (NZD) as they lead to higher yields, making the country a more attractive place for investors. On the contrary, lower interest rates tend to weaken NZD.
Employment is important for the Reserve Bank of New Zealand (RBNZ) because a tight labor market can fuel inflation. The RBNZ’s goal of “maximum sustainable employment” is defined as the highest use of labor resources that can be sustained over time without creating an acceleration in inflation. “When employment is at its maximum sustainable level, there will be low and stable inflation. However, if employment is above the maximum sustainable level for too long, it will eventually cause prices to rise more and more quickly, requiring the MPC to raise interest rates to keep inflation under control,” the bank says.
In extreme situations, the Reserve Bank of New Zealand (RBNZ) can enact a monetary policy tool called Quantitative Easing. QE is the process by which the RBNZ prints local currency and uses it to buy assets – usually government or corporate bonds – from banks and other financial institutions with the aim to increase the domestic money supply and spur economic activity. QE usually results in a weaker New Zealand Dollar (NZD). QE is a last resort when simply lowering interest rates is unlikely to achieve the objectives of the central bank. The RBNZ used it during the Covid-19 pandemic.
추천 기사
