• NZD/USD slipped lower on Monday after second-quarter inflation came in slightly below forecasts, reinforcing expectations that the Reserve Bank of New Zealand may begin easing monetary policy as early as August.
•Annual inflation rose to 2.7% in the second quarter , highest in a year and up from 2.5% in Q1 , but slightly below economists' expectations of 2.8%, Statistics New Zealand said on Monday.
• Quarter-on-quarter, the consumer price index (CPI) rose 0.5% in Q2, easing from a 0.9% increase in the previous quarter.
• Markets now assign a 75% probability to a 25 basis point rate cut by the RBNZ in August, up from 61% prior to the latest inflation data.
• Immediate resistance is located at 0.6002(38.2%fib), any close above will push the pair towards 0.6109 (23.6%fib).
• Support is seen at 0.5921(50%fib)and break below could take the pair towards 0.5883(Lower BB).
Recommendation: Good to sell around 0.5960 with stop loss of 0.6050 and target price of 0.5880
