The New Zealand Dollar (NZD) has made further gains on the Australian Dollar (AUD) this week- the third week straight, the cross reaching 0.9100 (1.0990) before dropping back to 0.9050 (1.1050) into Friday. The diverging central bank theory got put on notice midweek after the NZ CPI release indicated further interest rate hikes would be required to bring down rising inflation. With predictions of another 1.0% – 1.5% of further hikes this has and should make the NZD more attractive to investors. We expect the pair to sit around current levels for the next few days leading into the early Nov RBA cash rate release. The only data of note which could add value to the AUD is next week’s CPI q/q print. Buyers of AUD should consider prices above 0.9000 (1.1100) as we don’t expect the kiwi rally to hold into November.
The current interbank midrate is: NZDAUD 0.9032 AUDNZD 1.1066
The interbank range this week has been: NZDAUD 0.8938- 0.9100 AUDNZD 1.0989- 1.1187