- NZD/USD is oscillating around 0.6500 on hawkish RBNZ
- Officially, the OCR has been elevated to 2% after the announcement of a consecutive 50 bps rate hike.
- The RBNZ is determined to slow down the inflationary pressures and restrain aggregate demand.
The NZD/USD pair is attempting to overstep the psychological resistance of 0.6500 after getting more clarity over the monetary policy amid a press conference by Reserve Bank of New Zealand (RBNZ) Governor Adrian Orr.
In the press conference, RBNZ Orr has cleared that the central bank is focused to prevent the aggregate demand in the economy. Apart from that, pausing inflationary pressure is the major focus area. To safeguard the kiwi economy from the adverse impact of galloping inflation, the central bank is welcoming the certainty of recession.
In its monetary policy committee (MPC) meeting, RBNZ Governor announced a rate hike by 50 basis points (bps). It is worth noting that the RBNZ has elevated its Official Cash Rate (OCR) by half a percent consecutively. Officially, the RBNZ’s OCR has been increased to 2%.
Meanwhile, the US dollar index (DXY) has recovered the majority of its losses recorded on Tuesday. The DXY is attempting to overstep the round-level resistance of 102.00. Market mood has dampened mounting tensions between North Korea and Japan, which is why the DXY has observed some recovery.
Also, the market participants are awaiting the release of the Federal Open Market Committee (FOMC) minutes, which are due in the New York session. Investors will keep an eye on the economic indicators which forced Federal Reserve (Fed) policymakers to feature a 50 bps rate hike. In addition to that, the US Durable Goods Orders will remain in focus. The monthly Durable Goods Orders are seen at 0.6% against the prior print of 1.1%.