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NZD/USD binary signal - RBNZ Monetary Policy meeting - 09 May 2018

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Expiry Time: 
21:00 GMT
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The Reserve Bank of New Zealand will be holding its monetary policy meeting today late today at 21:00 GMT. Heading into the RBNZ's monetary policy meeting, the market expectations point to no changes to the RBNZ's Overnight Cash Rate (OCR) which is expected to remain steady at 1.75%.

Investors will be closely observing the statement from the Reserve Bank of New Zealand and also any clues on the forward guidance. The recent weak stretch of economic data could signal that interest rates will remain unchanged for the foreseeable future.

The RBNZ had previously forecast that interest rates would remain at the current levels until middle of 2019. With the recent inflation report showing that consumer prices were still weak and below the RBNZ's inflation target band of 2% - 3%, the central bank is likely to maintain the status quo unchanged.

The only positive data from the economy was the pickup in the unemployment rate which fell to a nine-year low according to data released last week. Still, the absence of any wage pressures will keep inflation muted heading into the second quarter.

Earlier in the day, the quarterly inflation expectations data was released. According to sources, the quarterly inflation expectations were seen rising 2.0% on the quarter. This was slower than the previous quarter's inflation expectation of 2.1%.

Based on the above today's forex trading signal is NZDUSD. The currency pair posted strong losses in just a few weeks time. However, the declines seem to be overstretched. The NZDUSD is seen trading close to the support level of 0.6944 – 0.6965 region.

The rebound off this support level is expected in the near term. Therefore, we are looking to purchase Put options at 0.6980 as we expect the NZDUSD currency pair to close lower on the day.

binary options signal nzdusd 09 may 2018

Disclaimer: The article is written for informative purposes only and it is not financial advice. The author does not have any position in the currency pairs mentioned, and no plans to initiate a position. He wrote the article himself and expressed his own opinions. He has no business nor personal relationships with any mentioned government entities or stocks. Readers should not treat any opinion expressed by the author as a specific inducement to make a particular trade or follow a particular strategy, but only as an expression of his opinion.