• NZD/USD eased on Thursday as markets reassessed the risk of a renewed inflation uptick, which could keep monetary policy tighter for longer.
•Interest rate expectations have shifted notably, with futures markets now pricing in a 59.4% probability of a rate hike by the Reserve Bank of New Zealand (RBNZ) in May, reflecting growing concern that inflation may prove more persistent.
•On the ratings front, Moody’s revised New Zealand’s outlook to negative from stable, citing rising fiscal and economic risks, although it maintained the country’s top-tier Aaa credit rating, limiting immediate downside pressure on the currency.
•Geopolitical tensions remain a key driver, with Iran’s seizure of two vessels underlining its strategic control over the Strait of Hormuz, a critical global oil chokepoint. This has pushed Brent crude back above $100 per barrel, heightening inflation risks globally.
• Immediate resistance is located at 0.5919(50%fib), any close above will push the pair towards 0.5968(Higher BB).
•Support is seen at 0.5878(Daily low) and break below could take the pair towards 0.5838(61.8%fib).
Recommendation: Good to buy around 0.5870 with stop loss of 0.5830 and target price of 0.5960
