Breaking: RBNZ hikes rate by 50bps, NZD/USD rallies

The Reserve Bank of New Zealand met on Tuesday to decide on its official cash rate and has lifted rates by the max expected, 50 basis points to 1.5% to combat inflationary headwinds pertaining to the Omricon disruptions and the Ukraine crisis.

NZD/USD has rallied to test the resistance of 0.6890s.

NZD/USD daily chart

Prior to the decision:

The M-formation is a reversion pattern on the daily chart and the neckline is located near the highs of Tuesday's business in the 0.6890s where it meets a 38.2% Fibonacci retracement level.

0.6820 on the downside and 0.6890 on the upside are critical levels that likely guard breakout territories for the days ahead. 

On the release:

More to come...

About the RBNZ

RBNZ Interest Rate Decision is announced by the Reserve Bank of New Zealand. If the RBNZ is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the NZD.