NZD/USD Holds Above 0.6000, Food Prices & 2yr Inflation Expectation Up Next

The Kiwi pushed drifted lower on Friday finishing the session down 0.24% at 0.6020. There session was relatively quiet with little in the way of local data or headlines while there was mixed messaging in the U. of Mich. Sentiment falling to 67.4 vs 76.2 est, from 77.2 in Apr, while headline sentiment missed expectations and pointed to a deteriorating consumer, the one-year inflation expectation metric rose to 3.5% from 3.2%, the highest since late 2023.

• The NZD/USD finished the Friday session towards the bottom of the daily range and spent most of the day trading within about 20-pips. The pair traded sideways the past week with the 100-day EMA acting as resistance, the 14-day RSI hovers above 50, while the MACD has started to print decreasing green bars. Early morning on Monday we trade down 0.05% at 0.6017.
• Key levels to watch: Initial resistance of 0.6044 (May 5 highs/100-day EMA) would be needed to test the of 0.6068 (200-day EMA), to the downside a clear break of 0.6000/6007 (round number support/ 50-day EMA) would open a move to 0.5981 (20-day EMA) and below here 0.5917 (May 2 lows).
• The US-NZ 2y is up 5bps to -13.5bps
• Option expiries: 0.5690 (NZD760m) while notable upcoming strikes are 0.5885 (NZD950m May 16), 0.5695 (NZD760m May 14), 0.5915 (NZD731.4m May 15)
• Looking ahead: Performance Services Index, Food Prices & 2Yr Inflation Expectation Today