Snapshot: NZDUSD is hovering around $0.584, pressured by a firmly entrenched RBNZ easing bias. The central bank cut rates by 25bp at its last meeting on April 9th, signalling further easing contingent on disinflation and labour market slack. Today’s US Pending Home Sales at 10:00 ET poses a moderate risk event.
- Watch for a break below $0.5830, which would open the door to further downside towards $0.5800.
- A surprise hawkish shift priced into the RBNZ outlook due to imported inflation remains a risk.
Bias into NY: Bearish on the Kiwi. The RBNZ’s dovish stance will likely keep downward pressure on NZDUSD, with any upside capped by a firming US dollar, currently supported by rising US 2Y yields at 4.09%.