Will the RBNZ Cut Its Interest Rate?

The most important news that we can expect in the next few hours is the announcement of the Reserve Bank of New Zealand’s interest rate. Considering the fact that the Reserve Bank of Australia recently cut its own interest rate this news is expected with even more interest.
Usually these two countries, so close both geographically and economically, maintain a difference of 0.50% between their interest rates.
Currently that difference is 0.75% which is a significant cause to think that RBNZ will cut its interest rate as well.

At the moment NZD/USD is moving to the upside in a correction, and it is forming a flag on the daily and the weekly time frames. In case the expectation for a rate cut does come true we will likely see a sharp move to the upside and then a significant drop.

In the alternate scenario the RBNZ won’t change the interest rate this month, which will cause some market volatility, but the corrective move to the upside will continue.

As I mentioned, the news is coming out in a few hours, so we will soon find out which one of these scenarios is valid.