RBNZ kept the Official Cash Rate unchanged at 0.25% today, but expanded the Large Scale Asset Purchase program to NZD 100B, up from NZD 60B. Eligible assets for the program remain unchanged. RBNZ also said a “package of additional monetary instruments must remain in active preparation”, including negative interest rates and purchases of foreign assets. Full statement here.
NSD/USD tumbles notable after the announcement. The development should confirm short term topping at 0.6715, after rejection by 0.6755 medium term resistance, on bearish divergence condition in daily MACD. The correction will likely take some time to complete and should eventually target 38.2% retracement of 0.5469 to 0.6715 at 0.6239. This will now remain the favored case as long as 0.6626 resistance holds, in case of recovery.
