Global macro overview for 10/03/2016:
The Reserve Bank of New Zealand unexpectedly cut the interest rate from the level of 2.5% to 2.25% during last night meeting. It is worth to mention, that the surprised decision came just five weeks after Governor Graeme Wheeler's speech in which he announced no rush to ease further in response to the weak inflation. Moreover, in the official statement made by RBNZ we can read that further easing may be required to help offset a recent decline in inflation expectations and help faltering dairy sector amid weak global economic background. The outlook for the world's economy had deteriorated since December, due to slower growth in China and Europe. In conclusion, this unexpected move from RBNZ might be just the first one and the most economists now expect a second reduction in the OCR in June.
Let's now take a look at the technical picture of NZD/USD after the rate cut. The market broke below the golden trend-line support. Currently, bulls might test the golden trend line from below and if they fail, bears will push the price even lower, targeting the strong support zone between the levels of 0.6565 - 0.6543.