Last week’s resurgence in inflation in the UK was confirmed by the rising CPI. This coming week the Bank of England will consider this and probably extend the ‘higher for longer’ interest rate settings. This will support the stronger GBP, with any dovish sentiment from the Fed, only adding to the Cables strength.
Current Level: 0.5184
Support: 0.5151
Resistance: 0.5215
Last week’s range: 0.5165 – 0.5204
European economies are suffering recessionary economic conditions, as confirmed by the flash PMI data released this week. Final PMI data will probably confirm this, in the coming week, while the market focus will turn to European growth and inflation. EU and member states inflation and GDP growth rates are set to be released, this coming week, and this will determine how the ECB will plan monetary policy. If inflation is confirmed as resurgent then rates will remain higher for longer. Alternatively, if GDP growth rates remain dire, the ECB may be encouraged to stimulate the European economy with rate cuts.
Current Level: 1.7758
Resistance: 1.7955
Support: 1.7670
Last Weeks Range: 1.7695 – 1.7930
European economies are suffering recessionary economic conditions, as confirmed by the flash PMI data released this week. Final PMI data will probably confirm this, in the coming week, while the market focus will turn to European growth and inflation. EU and member states inflation and GDP growth rates are set to be released, this coming week, and this will determine how the ECB will plan monetary policy. If inflation is confirmed as resurgent then rates will remain higher for longer. Alternatively, if GDP growth rates remain dire, the ECB may be encouraged to stimulate the European economy with rate cuts.
Current Level: 0.5631
Support: 0.5555
Resistance: 0.5665
Last week’s range: 0.5577 – 0.5651
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
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