New Zealand dollar steady as retail sales sparkleNZD/USDOANDA:NZDUSDOANDAThe New Zealand dollar is showing little movement on Monday. NZD/USD is trading at 0.5745 in the European session, up 0.07% on the day. The week started on a high note in New Zealand, as retail sales jumped 0.9% q/q in the fourth quarter of 2024, after a revised flat reading in the third quarter and above the market estimate of 0.6%. This was the strongest gain in three years. Most sub-categories posted gains as the improvement was felt across the economy. Annually, retail sales posted a small gain of 0.2% in the fourth quarter following a 2.2% decline in Q3. This was the first gain since Q3 of 2022. The strong impressive rebound in retail sales is a sign that lower interest rates are filtering through the economy and boosting weak growth. The Reserve Bank of New Zealand has been aggressive, chopping rates by 50 basis points in October, November and February. The cash rate is down to 3.75%, its lowest level since Oct. 2022. Consumers are showing improved confidence due to lower borrowing costs and are opening up the purse strings. The Reserve Bank of New Zealand plans to continue cutting rates but in a more gradual fashion. Governor Adrian Orr signaled at last week's meeting that he expects to cut rates by 25 basis points in both April and May, provided that economic conditions evolve as projected. In the US, the Services PMI for February surprised on the downside and contracted to 49.7, down from 52.9 in January and below the market estimate of 53.0. This marked the lowest level since January 2023. The services sector, which has been the major driver of the US economy, showed strong growth until the end of 2024 and has weakened for two straight months. The Manufacturing PMI improved to 51.6, up from 51.2 and above the market estimate of 51.5. 0.5731 is a weak support level. Below, there is support at 0.5688 0.5783 and 0.5826 are the next resistance lines