GBP

The New Zealand Dollar (NZD) extended its momentum this week over the Australian Dollar (AUD) reaching 0.9240 (1.0820) the third straight week of bullish continuation. Clearing key resistance at 0.9200 (1.0870) yesterday could signal further moves to the topside over the next while. If we look at the 50% fib level of the yearly low and highs we would expect a retest of the level at 0.9260 (1.0800) then 0.9300 (1.0750) over the coming days. The RBNZ left interest rates on hold at 5.5% this week suggesting inflation is still causing issues meaning interest rates could remain high into early 2025. Earlier expectations were that the central bank could cut as early as August this year- this is now highly unlikely. NZ Retail Sales won’t be helping inflation either publishing at 0.5% compared to a dip of -0.3% predicted in first quarter 2024.

The current interbank midrate is: NZDAUD 0.9230 AUDNZD 1.0826

The interbank range this week has been: NZDAUD 0.9139- 0.9243 AUDNZD 1.0818- 1.0942

The Australian Dollar (AUD) traded into Tuesday to 0.6120 (1.6335), just below the weekly open, the Euro enjoying the weaker sentiment and mixed Chinese CPI data pulling on the AUD. Markets await Australian jobs data tomorrow expected to show a slight rise to 3.9% from 3.8% based on a range of economic indicators reflecting an economy easing and a deterioration of the job’s market. The number of job’s adds in Australia has fallen sharply down to 2021 levels as the demand from employers drops. A retest of 0.6105 (1.6380) looks likely.

Current Level: 1.6345
Resistance: 1.6380
Support: 1.6180
Last Weeks Range: 1.6218- 1.6382

The Australian Dollar (AUD) traded into Tuesday to 0.6120 (1.6335), just below the weekly open, the Euro enjoying the weaker sentiment and mixed Chinese CPI data pulling on the AUD. Markets await Australian jobs data tomorrow expected to show a slight rise to 3.9% from 3.8% based on a range of economic indicators reflecting an economy easing and a deterioration of the job’s market. The number of job’s adds in Australia has fallen sharply down to 2021 levels as the demand from employers drops. A retest of 0.6105 (1.6380) looks likely.

Current Level: 0.6118
Resistance: 0.6180
Support: 0.6105
Last Weeks Range: 0.6104- 0.6165

As we predicted the Australian Dollar (AUD) rallied through to 0.5295 (1.8890) levels late last week against the British Pound (GBP) before giving back gains to 0.5265 (1.9000) into morning trading. The Pound has been well bid off the back of surprisingly good UK data with Industrial Production coming in better than expected with output rising 0.2% in March of 0.1% in February and a fall of 0.5% in January. UK Claimant numbers print tonight and should show around 14,000 people filed for unemployment in April, up from March’s 10,900- this number trending upwards over the past few months. Unemployment also prints in Australia later in the week which should tick up to 3.9%-4.0%

Current Level: 1.9022
Resistance: 1.9100
Support: 1.8900
Last Weeks Range: 1.8898- 1.9034

Yesterday’s NZ inflation expectations release put the New Zealand Dollar (NZD) under pressure against the Euro (EUR) the cross falling to 0.5570 (1.7945) off 0.5595 (1.7880). The 2-year inflation forecast decreased from 2.5% to 2.33% with the 1 year decreasing to 2.73% down from 3.22%. Earlier Lagarde confirmed a rate cut by the European Central Union will happen in the June meeting easing its monetary policy from 4.35%. We expect a slow burn in  the cross back to 0.5650 (1.7700) resistance over the next while.

Current Level: 1.7946
Resistance: 1.8120
Support: 1.7830
Last Weeks Range: 1.7853 – 1.7965

Yesterday’s NZ inflation expectations release put the New Zealand Dollar (NZD) under pressure against the Euro (EUR) the cross falling to 0.5570 (1.7945) off 0.5595 (1.7880). The 2-year inflation forecast decreased from 2.5% to 2.33% with the 1 year decreasing to 2.73% down from 3.22%. Earlier Lagarde confirmed a rate cut by the European Central Union will happen in the June meeting easing its monetary policy from 4.35%. We expect a slow burn in  the cross back to 0.5650 (1.7700) resistance over the next while.

Current Level: 0.5572
Support: 0.5520
Resistance: 0.5610
Last week’s range: 0.5566- 0.5601

After a decent week of improvement for the New Zealand Dollar (NZD) with price extending to 0.4825 (2.0720) late in the week the kiwi has given back most of this move against the British Pound (GBP) to drop back to 0.4790 (2.0870) this morning. NZ’s latest survey of inflation expectations showed a continued moderation in the 2-year forecast which dropped from 2.5% to 2.33% along with the 1 year forecast from 3.22% to 2.73%. This should give relief to the RBNZ as no further hikes should be needed. UK Claimant change should reflect a rise of around 14,000 people to the unemployment numbers in April a rising trend following recent months of numbers looking for work. A retest of 0.4780 (2.0930) this week is our pick.

Current Level: 2.0881
Resistance: 2.1130
Support: 2.0720
Last Weeks Range: 2.0723- 2.0923

After a decent week of improvement for the New Zealand Dollar (NZD) with price extending to 0.4825 (2.0720) late in the week the kiwi has given back most of this move against the British Pound (GBP) to drop back to 0.4790 (2.0870) this morning. NZ’s latest survey of inflation expectations showed a continued moderation in the 2-year forecast which dropped from 2.5% to 2.33% along with the 1 year forecast from 3.22% to 2.73%. This should give relief to the RBNZ as no further hikes should be needed. UK Claimant change should reflect a rise of around 14,000 people to the unemployment numbers in April a rising trend following recent months of numbers looking for work. A retest of 0.4780 (2.0930) this week is our pick.

Current Level: 0.4789
Resistance: 0.4825
Support: 0.4735
Last Weeks Range: 0.4779- 0.4825

The New Zealand Dollar (NZD) declined off the weekly open to 0.9100 (1.0990) against the Australian Dollar (AUD) but turned bid Tuesday clawing back losses to 0.9115 (1.0970)- perhaps off the back off mixed Chinese inflation data- prices rose in the month of April with the y/y number printing at 0.3% vs 0.1% in March. Of note this morning NZ Card Retail Sales declined -0.4% in April and net migration lost 52,500 people in the year ending March 2024 won’t bode well for the kiwi. Australian unemployment prints Thursday with expectations of a rise to 3.9%, this will be priced into the RBA rate cut curve and more particularly the NZD/AUD if the number comes in benign. We expect a retest of 0.9100 (1.0985) over the next day or so.

Current Level: 1.0973
Resistance: 1.1025
Support: 1.0950
Last Weeks Range: 1.0948- 1.1029