FX News

The New Zealand Dollar (NZD) extended through to a fresh yearly high of 0.9445 (1.0585) late Friday against the Australian Dollar (AUD) after reports from the ANZ that more rate hikes were on the way had investors in a mood to buy up NZD. Monday’s open reflected a reversal of fortunes, the kiwi giving back gains as price sank back to 0.9385 (1.0655) the December high. Today’s NZ Inflation Expectations and Thursday’s Aussie jobs data could throw up surprises, we expect the NZD to stay in charge.

Current Level: 0.9384
Resistance: 0.9440
Support: 0.9345
Last Weeks Range: 0.9313- 0.9448

It’s been a quiet start to the week in the New Zealand Dollar (NZD), US Dollar (USD) cross with markets tentative ahead of US CPI y/y data publishing tonight. Expectations are for a fall from 3.4% to 2.9% which ultimately may force the hand of the Fed to cut rates sooner. The recent shift from the RBNZ on rate cut forecasts will have an impact in today’s NZ Inflation Expectations release. We should get a drop in the 2-year, 5-year and 10-year forecasts which could impact on future cut predictions and the timing of another hike or two. Certainly, investors are positioning for this with the kiwi outperforming last week. Governor Orr speaks Friday- “Monetary Policy Remit and 2% Inflation” which could be interesting. Support at 0.6080 should also ensure the kiwi has a positive week.

Current Level: 0.6128
Support: 0.6080
Resistance: 0.6220
Last week’s range: 0.6037- 0.6157

US Non-Farm Payroll sent the New Zealand Dollar (NZD) reeling Friday, dropping from 0.6150 levels against the US Dollar (USD) to 0.6060 where the cross closed the week. Figures showed an improvement in jobs added in December of 216,000 with most industry sectors adding jobs, the print a lot better than the 173,000 expected. Early in the week the kiwi posted a new 2024 low of 0.6035 before recovering off NZ Job’s data into Friday. NZ unemployment clicked higher from 3.9% in the third quarter to 4.0% after a forecast of 4.3% was expected, confirming a slowdown in the NZ economy is playing out. This sparked a flurry of NZD buying, the kiwi pushing back to 0.6125. Next week’s economic docket is sizable with US CPI and NZ inflation expectations due. Traffic around 0.6000 looks safe for now.

The current interbank midrate is: NZDUSD 0.6093

The interbank range this week has been: NZDUSD 0.6037- 0.6123

NZ Waitangi Day holiday made for a slow start to the Australian Dollar (AUD), New Zealand Dollar (NZD) cross as it bounced around the 0.9330 (1.0720) zone. The Reserve Bank of Australia (RBA) released their cash rate Tuesday with no change from 4.35% widely anticipated. May’s early forecast for a rate cut in May could have been a tad optimistic with the central bank not ruling out 1 more hike based on stubbornly high inflation at 4.1%. The Aussie fell apart post the news dropping to 1.0640 (0.9400) where it sits early Friday at fresh yearly lows as investors exited the AUD. NZ Jobs data reflected a small rise to unemployment from 3.9% to 4.0% supporting the kiwi moves. We could see the cross push higher through 0.9400 (1.0640) into the close however 0.9425 (1.0610) should offer reasonable resistance.

The current interbank midrate is: NZDAUD 0.9384 AUDNZD 1.0648

The interbank range this week has been: NZDAUD 0.9310- 0.9402 AUDNZD 1.0635- 1.0741