NZD/USD bullish bets above 0.6690 marked down by CPI miss

• NZD/USD bulls have been stopped in their tracks by the miss in the CPI data.
• The US dollar found a lease of life on Wall Street, bulls encouraged by data.

New Zealand’s Consumer Price Index was released in recent trade which has changed the bird’s flight trajectory in early Asia.

At the time of writing, NZD/USD is trading at 0.6667 between a low of 0.6660 and from a high of 0.6677.
Overnight, the bird was pushing up against 0.6690 despite some ground made in the US dollar.

But in Asia, the CPI data missed expectations and has put a roadblock up for the bulls. 

NZ CPI

New Zealand CPI (QoQ) Q3: 0.7% (exp 0.9%; prev -0.5%) CPI (YoY) Q3: 1.4% (exp 1.7%; prev 1.5%).
Markets will be in anticipation of the next move from the Reserve bank of New Zealand.

”The RBNZ has indicated that a Funding for Lending Programme (FLP) is the next cab off the rank in terms of monetary stimulus, essentially providing cheap funding to the banks with the explicit focus of targeting lower retail interest rates,” analysts at ANZ bank explained. 

”We expect an FLP will be announced at the November MPS meeting and deployed soon after. The FLP will be complementary to the existing LSAP programme, while negative interest rates are expected to be added next year.”

US data was encouraging 

Meanwhile, the US headlines on US fiscal negotiations were mixed overnight but jobless claims and housing reports were encouraging.

Weekly jobless claims for the US eased this week with both initial claims and continuing claims lower than anticipated. 

The data showed initial claims for state unemployment benefits in the United States dropped 55,000 to a seasonally adjusted 787,000 last week, although the overall number was still relatively high. A Reuters survey had forecast 860,000 claims in the latest week.

”This follows a lift in the number of people claiming an unemployment benefit last week, but these data tend to be volatile, and numbers are still historically high, so it is too early to say the job situation is improving. ’

Markets will be tuned in to tonights final US Presidential debate in anticipation of some showmanship from the US President Donald Trump in the last effort to win over the US population. 

His contestant, Joe Biden, is leading in the polls which are encouraging short positions the greenback as expectations of larger stimulus will come from a Democrat landslide victory.

NZD/USD levels

The bird, while holding above bullish structure, is destined for higher highs.