Ella 
In early Asian trading on Thursday, NZD/USD remained on the defensive around 0.6100. The Reserve Bank of New Zealand turned dovish at its monetary policy meeting, boosting NZD/USD. Focus will turn to Thursday’s U.S. PCE price index inflation data.
Data released by the U.S. Department of Commerce on Wednesday showed that the U.S. economy grew at an annualized rate of 3.2% in the fourth quarter, compared with the initial estimate of 3.3%. Despite predictions that rising Federal Reserve interest rates could tip the world’s largest economy into recession, U.S. gross domestic product (GDP) growth has now exceeded 2% for six consecutive quarters.
The Reserve Bank of New Zealand decided to keep the official cash rate (OCR) unchanged at 5.5% at its February monetary policy meeting, in line with market expectations. However, the Monetary Policy Committee (MPC) said that while the Reserve Bank of New Zealand continues to believe that the risks to the official cash rate from rising are high, the central bank no longer predicts further tightening policy. This in turn puts some selling pressure on NZD/USD and acts as a headwind for NZD/USD.
Next, market participants will pay close attention to the US PCE price index for January released on Thursday. In addition, U.S. personal income, personal spending, existing home sales and weekly jobless claims will be released later in the day, and Fed officials Bostic, Goolsby and Mester will also speak. These events could give NZD/USD a clear direction.
