• NZD/USD hovered near six month low on Friday as kiwi dollar continued to underperform on RBNZ’s dovish policy.
• On Wednesday, the RBNZ surprised markets with a larger-than-expected 50 basis point rate cut, bringing the Official Cash Rate (OCR) down to 2.5%.
• Since August 2024, the central bank has reduced rates by a total of 300 basis points, and with inflation now within its 1%–3% target range, policymakers have room to ease borrowing costs further.
• Markets are now assigning an 80% chance of a 25-basis-point rate cut at the RBNZ’s November meeting, with roughly even odds that the OCR could drop to 2.0% by next year.
• Immediate resistance is located at 0.5795(50%fib), any close above will push the pair towards 0.5712(Lower BB).
• Support is seen at 0.05700 (Lower BB) and break below could take the pair towards 0.5664(Lower BB).
Recommendation: Good to sell around 0.5770 with stop loss of 0.5860 and target price of 0.5700


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