The Reserve bank of New Zealand is reported to have continued easing its monetary policy in December, Market Leader reports. In particular, the central bank announced an interest rate cut and assured everyone that it would implement more interest rate cuts if necessary. More specifically, the RBNZ decided to cu the rate by a quarter of a percent down to 2.5%.
Masterforex-V Academy experts say that this decision made by the central bank is showing its determination to back the national economy instead of waiting till the Fed start raising its interest rates as planned I the near future. The thing is that despite rumors, expectations and a lot of talk going on around the Fed’s forthcoming interest rate hike, the time of the first interest rate hike in the USA is still questioned.
Meanwhile, Masterforex-V Academy experts report that this is the 4th interest rate cut the Reserve Bank of New Zealand has implemented this year. All in all, the mentioned interest rate cut didn’t come as a surprise since it had been anticipated by most of the experts interviewed by Bloomberg and Reuters. Low inflation happens to be one of the key reasons why the RBNZ decided to cut the rate one more time.
FOREX
In the meantime, the New Zealand Dollar continues its mid-term rally against the U.S. Dollar. The NZDUSD currency pair is forming an upswing represented by wave A/B of level Daily 2 or even higher, Masterforex-V Academy experts say.
The thing is that the price is currently developing a minor move - wave a(C ) or shortened C – inside the mentioned one. Please keep in mind that such levels as 0.6785, 06896 as well as 0.6790, 0.6866 are currently treated as the closest major levels of resistance, which means the price may find it difficult to pass through them. Alternatively, if the price breaks below the bottom of the ascending MF sloping channel and MF pivot 0.6574, this is going to be the end of the mentioned rally.
