As we said last week, momentum in the Australian Dollar (AUD) continued off Monday’s open 1.0890 (0.9180) extending to 1.1020 (0.9075) Thursday, the highest level in the cross since February. The RBA surprised markets by hiking 25 points to 4.10% Tuesday rallying the Aussie as buyers dived in. With inflation stubbornly high the central bank is likely to raise rates again in July. Meanwhile Australian first quarter growth came in 0.2% lower than the 0.3% predicted as it continues to slow raising questions around the aggressiveness of the RBA policy. With the cross now well supported below 0.9100 (1.0990) the next area of support lies at 0.9000 (1.1100). Focus now is with next week’s first Q NZ GDP with expectations the economy could slip into recession after a -0.6% release in the last quarter of 2022. This will be unwelcome news for the NZD as the currency becomes less attractive. The saving grace could be high interest rates.
The current interbank midrate is: NZDAUD 0.9076 AUDNZD 1.1008
The interbank range this week has been: NZDAUD 0.9065- 0.9192 AUDNZD 1.0879- 1.1031