NZD/USD Gains as Split RBNZ Decision Signals Cautious Easing Approach

NZD/USD rose 0.6% to 0.5650 after the Reserve Bank of New Zealand's split decision on rate cuts revealed internal disagreement about the pace of monetary easing. The RBNZ board voted 5-2 for a 50bp cut versus a smaller 25bp reduction, highlighting divided views on economic risks and inflation trajectory. This lack of consensus suggests the central bank may adopt a more measured approach to future rate cuts, providing unexpected support for the New Zealand dollar. Market pricing now reflects only a 60% probability of another 50bp cut at the next meeting, down from 85% pre-announcement. Technical analysis shows NZD/USD breaking above its 20-day moving average at 0.5630, with momentum indicators turning positive. The pair faces resistance at 0.5700, while support has formed at 0.5600. Traders are positioning for potential kiwi strength if inflation data remains sticky.