NZD/USD Plunges on Weak GDP - RBNZ Rate Cut Expectations Surge
NZD/USD tumbled 1.2% to 0.6080 following shocking GDP data that significantly increased pressure on the Reserve Bank of New Zealand to implement more aggressive rate cuts. New Zealand's economy contracted more than expected, prompting markets to price in a 75% probability of a 50 basis point cut at the next RBNZ meeting. The kiwi dollar's weakness extended against other majors, with AUD/NZD surging 0.9% to 1.0950 as relative economic performance favored the Australian dollar. Technical indicators show NZD/USD breaking below crucial support at 0.6100, with the next target at 0.6050. The 200-day moving average at 0.6150 now acts as resistance. Currency strategists warn that continued economic weakness could push the pair toward 0.6000 psychological support, particularly if the RBNZ signals an accelerated easing cycle in upcoming communications.
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