The GBP has been fairly static, but may show some signs of life in the coming week, due to the Bank of England rate decision. Inflation in the UK jumped back to 4%, from 3.9%, reversing sharp recent falls. This will only encourage the Bank of England to leave interest rates ‘higher for longer’, thus supporting a stronger Pound.
Current Level: 2.0820
Resistance: 2.0965
Support: 2.0695
Last Weeks Range: 2.0710- 2.0937
The GBP has been fairly static, but may show some signs of life in the coming week, due to the Bank of England rate decision. Inflation in the UK jumped back to 4%, from 3.9%, reversing sharp recent falls. This will only encourage the Bank of England to leave interest rates ‘higher for longer’, thus supporting a stronger Pound.
Current Level: 0.4823
Resistance: 0.4840
Support: 0.4765
Last Weeks Range: 0.4776 – 0.4828
The AUD and NZD have both been in a reasonably tight trading range for the last week, with NZ inflation easing and Australian flash PMI data showing recessionary economic conditions. The cross rate has been tight, trading between 0.9200 and 0.9300, with no major moves expected to the upside or downside.
Current Level: 1.0784
Resistance: 1.0855
Support: 1.0731
Last Weeks Range: 1.0752 – 1.0832
The AUD and NZD have both been in a reasonably tight trading range for the last week, with NZ inflation easing and Australian flash PMI data showing recessionary economic conditions. The cross rate has been tight, trading between 0.9200 and 0.9300, with no major moves expected to the upside or downside.
Current Level: 0.9265
Resistance: 0.9315
Support: 0.9215
Last Weeks Range: 0.9231 – 0.9300
NZ Q4 Inflation data confirmed inflation is declining fast, falling from 5.6% to 4.7%, easing the pressure on the RBNZ. The easing of inflationary conditions in New Zealand will allow monetary policy to at least neutralise in 2024, with a view to rate cuts later in the year. Bond yields will start to fall and this will ease pressure on the NZ Dollar. The NZD has traded around 0.6100 for the last week, but will rely on easing monetary conditions in the US for any upside.
Current level: 0.6105
Support: 0.6055
Resistance: 0.6175
Last week’s range: 0.6064-0.6145
The Australian Dollar (AUD) has been massacred thus far in 2024 coming from 0.5360 (1.8650), we have seen the British Pound (GBP) gain strength to 1.9330 (0.5175) this morning. Retail Sales in the UK sent the GBP lower briefly when data published at -3.2% instead of the anticipated -0.5% however the GBP recovered into the weekly close. UK Manufacturing data is predicted to come in soft Wednesday before an Aussie Day holiday Friday. Massive support at 0.5170 (1.9350) could come into play.
The current interbank midrate is: AUDGBP 0.4781 GBPAUD 2.0916
The interbank range this week has been: AUDGBP 0.5168- 0.5204 GBPAUD 1.9213- 1.9347
Are we seeing signs of a long-term base forming in the Australian Dollar (AUD), US Dollar (USD) pair at 0.6530? A January close below this level would be cause for concern and a rethink of where support lies. Certainly, when we look at the yearly open price circa 0.6815 the Aussie has come off a chunk in a short period of time. With the RBA done hiking interest rates, 2024 will be about cuts and the timing of these. We are forecasting 3 plus cuts in 2024. Let’s hope the banks pass on these rate drops to consumers- say are saying mortgage holders shouldn’t get too excited as not all cuts are passed down. The AUD may be pushed around this week by offshore forces based on no data publishing and an Australian Holiday Friday creating thin market conditions.
The current interbank midrate is: AUDUSD 0.6567
The interbank range this week has been: AUDUSD 0.6564- 0.6612
The New Zealand Dollar (NZD) has been unable to get a look against the British Pound (GBP) so far in 2024 with the cross reaching 0.4790 (2.0880) this morning. The yearly open was circa 0.4970 (2.0120) so far it hasn’t been a particularly good start to the year from the kiwi. The only blip on the chart came late last week when UK Retail Sales published poorly at -3.2% compared to predictions of -0.5%. Taking the GBP lower briefly before recovering on a lack of risk in the market. This week’s docket sees NZ CPI q/q which is expected to print around 0.5% and take the y/y figure from 5.6% to 4.7% cementing the need for the RBNZ to cut rates mid-year. The GBP may struggle to breach 0.4775 (2.0950) support this week.
The current interbank midrate is: NZDGBP 0.5169 GBPNZD 1.9346
The interbank range this week has been: NZDGBP 0.4777- 0.4830 GBPNZD 2.0700- 2.0931
Moves in the Australian Dollar (AUD), New Zealand Dollar (AUD) cross extended off 0.9275 (1.0780) Monday from mid week’s 0.9365 (1.0680) as the Aussie eyes a fresh yearly high around 1.0830 (0.9230). The IMF has suggested the RBA should cut spending and hike rates further in order to reduce inflation targets back to the target band before 2026. This will have certainly been factored into recent AUD demand. The economic docket is thin this week in the pair with only NZ CPI y/y printing. Forecast is for a fall of 0.5% in the fourth quarter down from 1.8% in the third quarter. Year on year should print around 4.7% down for 5.6% confirming further pressure for the RBNZ to cut rates mid year or sooner. Australia Day Holiday Friday should see the cross meander into the close.
The current interbank midrate is: NZDAUD 0.9245 AUDNZD 1.0809
The interbank range this week has been: NZDAUD 0.9243- 0.9289 AUDNZD 1.0765- 1.0818
The New Zealand Dollar (NZD) has been sold off heavily in 2024 after starting the year at 0.6300 levels it has fallen to 0.6080 against the US Dollar (USD). NZ Manufacturing PMI’s were down to 43.1 from 46.5, together with talk around rate cuts have had a negative impact on the kiwi. NZ CPI tomorrow is due to publish much lower than the previous quarter of 5.6% y/y at 4.7% y/y confirming rate cuts should start around mid-year. Current forecasts are that inflation is predicted to be back around the target range of 1-3% by the third quarter. The cross is looking oversold to us at current levels, we would need to see a break below 0.6000 to confirm a bearish trend and take the heat off upside moves.
The current interbank midrate is: NZDUSD 0.6077
The interbank range this week has been: NZDUSD 0.6067- 0.6137