NZD/USD consolidates Tuesday's gains, trades above 0.65 ahead of key events
- The FOMC is expected to keep its policy rate unchanged on Wednesday.
- US Dollar Index posts small daily losses, sits above 97.50.
- Statistics New Zealand will release the first quarter GDP data.
After adding 40 pips and closing the day at 0.6535, the NZD/USD has gone into a consolidation phase as investors moving to the sidelines ahead of key events of the day. As of writing, the pair was posting small daily losses at 0.6525.
The greenback, which took advantage of the selling pressure surrounding the euro, gathered strength against its rivals on Tuesday and the US Dollar Index advanced to its highest level in two weeks at 97.77. The dollar's next move is very likely to be triggered by the FOMC statement and Chairman Powell's remarks later today. At the moment, the DXY is down 0.06% on a daily basis at 97.58.
Previewing this event, “We expect clear signals of rate cuts ahead at Chair Powell’s press conference and expect the dot plot to support that message," Nordea Markets analysts said. “We changed our Fed forecast and now expect four rate cuts starting in July, though the Fed is not anywhere near that dovish yet.”
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On the other hand, in the early trading hours of the Asian session on Wednesday, the Statistics New Zealand will release the first-quarter Gross Domestic Product (GDP) figures, which is expected to show a 2.4% growth on a yearly basis following the 2.3% reading in the last quarter of 2018.
Technical levels to consider
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