FxWirePro: NZD/USD edges higher ahead of RBNZ decision

• NZD/USD  edged  higher on Monday  as traders braced for a widely expected interest rate hike by RBNZ

• Markets widely expect the Reserve Bank of New Zealand to raise its policy rate by a quarter-point to 2.75% on Wednesday, with attention focused on how much further rates could rise under its new economic projections.

•The RBNZ raised its OCR to 2.50% in July, resuming monetary tightening as it attempts to push inflation, which peaked at 3.9% in the June quarter, back toward its 1%-3% target range.

• According to a Reuters poll, 90% of economists expect the RBNZ to deliver a 25-basis-point rate hike to 2.75% on September 2, with two-thirds forecasting another increase this year that would push the cash rate to at least 3% by December..

• Investors expect interest rates to reach 3.0% by December and 3.5% next year as the central bank moves away from outright stimulus toward a more neutral policy stance.

•  Immediate resistance is located at 0.5930(38.2%fib), any close above will push the pair towards 0.5943(SMA 20).

•  Support is seen at 0.5904(Lower BB) and break below could take the pair towards 0.5881(50%fib).

 Recommendation: Good to buy around 0.5910  with stop loss of 0.5850 and target price of 0.6000