NZDUSD is moving in Ascending channel and the market has fallen from the higher high area of the channel.
As per NZIER economists report RBNZ must do rate hike of 25bps tomorrow due to inflation is out of control 1-3% area. Still more rate hikes in 2023 due to economy is going to shrink in Q2 2023, rate will be projected at 5.5% this year . On the impact of Cyclone Gabrielle, RBNZ said inflation will set to grow and other disruptions there in economy
RBNZ rate hike
The Reserve Bank of New Zealand raised the mandatory cash rate by 50 basis points during its first meeting of the year, bringing it up to 4.75 percent from its previous level of 4.725 percent. This is the highest number that it has been since January 2009, and it is consistent with the expectations that the market had for it. Since October 2021, there have been a total of 450bps worth of increases thanks to the move that took place on Wednesday, which was the tenth consecutive increase in a row.
EURNZD is moving in Ascending channel and the market has fallen from the higher high area of the channel.
This constitutes the most significant adjustment that has taken place since 1999.
The board highlighted that consumer inflation, which was running at an annual rate of 7.2%, as well as core inflation, were excessive, that inflation expectations were unfavorable, and that employment was beyond its sustainable level. Consumer inflation was running at an annual rate of 7.2%. Core inflation was excessive.
Impact of Cyclone Gabrielle
The committee projected that there will be further increases in the interest rate, with the largest one reaching 5.5% by the end of this year. In spite of this, the controlling authority predicted that there would be a decrease in economic activity during the second quarter of 2023.
GBPNZD is moving in Ascending channel and the market has rebounded from the higher low area of the channel.
As a direct consequence of Cyclone Gabrielle, the Reserve Bank of New Zealand has predicted that there will be an increase in inflation as well as disruptions in production over the next few days and weeks.
On the other hand, the reconstruction efforts will result in an increase in commerce in the years to come. The greatest contribution that monetary policy can make is to free up resources in other areas by lowering demand through the use of increased interest rates. This is by far the most important contribution that monetary policy can make. This is the most important contribution that can be made by monetary policy.
NZIER on Inflation
A more moderate increase in the Official Cash Rate should be implemented by the Reserve Bank during the upcoming Monetary Policy Review in April, according to the most current report from the New Zealand Institute of Economic Research .
AUDNZD is moving in box pattern and the market has reached the support area of the pattern.
And inflationary pressures are still strong in the economy, and expectations are still higher than the range of 1–3 percent that the Reserve Bank has set as its target for inflation. The report also notes that the majority of people believe the OCR should be raised by 25 basis points.
And The Reserve Bank was also counselled to keep the overnight cash rate at its present level of 4.75 percent by two members of the Shadow Board. One of these members was of the opinion that the OCR should have already achieved its maximum, while the other member was of the opinion that there is a greater possibility of a recession occurring in the near future.
NZDJPY is moving in box pattern and the market has rebounded from the support area of the pattern.
The core opinion of the Shadow Board regarding where the OCR should be in one year ranged from 4.25 percent to 5.50 percent. In order to bring down inflation, some members have proposed that the Reserve Bank should abstain from increasing the OCR after April and instead should keep it at its current level for an extended period of time. There was one Shadow Board member in the business community who was of the opinion that the OCR ought to be lower in a year given the fact that increases in interest rates have already had a significant negative effect on the profitability and earnings of businesses up to this point.
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