NZD

The cross rate has reached highs of 0.9450, in the last week or so, leading into the latest RBNZ Rate Decision. The NZ Central Bank’s ‘dovish’ stance has allowed the cross rate to drift off recent highs, to trade around 0.9350. The Australian CPI inflation number, released this week, was in line with expectations. The cross rate was softer due to the RBNZ dovish sentiment, but any ‘hawkish’ stance by the RBA Governor, could see the cross-rate re-test highs.

The current interbank midrate is: NZDAUD .9360 AUDNZD 1.0684

The interbank range this week has been: NZDAUD .9358 – 9457 AUDNZD 1.0574 – 1.0682

The RBNZ left rates unchanged, as expected by markets, this week gone by. The previous CPI inflation reading from NZ, was softer than expected, and this has led to a more ‘dovish’ approach to monetary policy. The NZD tumbled against all currencies, with the prospect of further weakness, as the Fed continues the ‘higher for longer’ mantra.

The current interbank midrate is: NZDUSD .6092

The interbank range this week has been: NZDUSD .6072 – .6194

We have seen a breakout through the 1.6500 (0.6060) area in the Euro (EUR), Australian Dollar (AUD) pair Monday, the Euro rallying to 1.6600 (0.6025) in morning trade, the Euro clocking a key triple top level. Today’s Australian CPI y/y releases tomorrow and is predicted to come in above December’s 3.4%. This will concern the RBA as they target the 2-3% inflation band but may not be enough to warrant the central bank hiking further, it may just imply they push back rate cuts. Recent ECB speak suggests they are not about to cut any time soon. Watch for a retrace back around the 1.6550 (0.6040) area.

Current Level: 1.6597
Resistance: 1.6620
Support: 1.6475
Last Weeks Range: 1.6450- 1.6537

We have seen a breakout through the 1.6500 (0.6060) area in the Euro (EUR), Australian Dollar (AUD) pair Monday, the Euro rallying to 1.6600 (0.6025) in morning trade, the Euro clocking a key triple top level. Today’s Australian CPI y/y releases tomorrow and is predicted to come in above December’s 3.4%. This will concern the RBA as they target the 2-3% inflation band but may not be enough to warrant the central bank hiking further, it may just imply they push back rate cuts. Recent ECB speak suggests they are not about to cut any time soon. Watch for a retrace back around the 1.6550 (0.6040) area.

Current Level: 0.6025
Resistance: 0.6070
Support: 0.6015
Last Weeks Range: 0.6047- 0.6079

UK Consumer Confidence slipped to -21 from -19 in January coming in well below forecast. This being said the British Pound (GBP) has managed to hold onto gains Monday extending last week’s rally from 1.9190 (0.5210) to 1.9400 (0.5155). Broad based momentum is firmly with the GBP after starting the year at 1.8250 (0.5480). We are picking a retest of the yearly low at 0.5120 (1.9520)  over the coming days as the  current trendline supports. Aussie Retail Sales at the end of the week could give us some AUD upside with predictions of a decent number printing.

Current Level: 1.9409
Resistance: 1.9500
Support: 1.9250
Last Weeks Range: 1.9191- 1.9329

For 6 weeks straight the New Zealand Dollar (NZD) has had the better of the Euro (EUR) coming from 0.5585 (1.7900) levels to 0.5735 (1.7440)  yesterday. Monday’s action has seen the kiwi give back a chunk of these gains to 0.5690 (1.7570) as ECB rate cuts exit the table. The NZD still needs to make a break below 0.5680 (1.7600) to clear the bear channel and signal a trend change to the downside. Tomorrow’s RBNZ policy meeting has most of us suggesting the central bank won’t hike interest rates past  5.50% but the rhetoric around future plans could move the cross.

Current Level: 1.7590
Resistance: 1.7700
Support: 1.7415
Last Weeks Range: 1.7438- 1.7597

For 6 weeks straight the New Zealand Dollar (NZD) has had the better of the Euro (EUR) coming from 0.5585 (1.7900) levels to 0.5735 (1.7440)  yesterday. Monday’s action has seen the kiwi give back a chunk of these gains to 0.5690 (1.7570) as ECB rate cuts exit the table. The NZD still needs to make a break below 0.5680 (1.7600) to clear the bear channel and signal a trend change to the downside. Tomorrow’s RBNZ policy meeting has most of us suggesting the central bank won’t hike interest rates past  5.50% but the rhetoric around future plans could move the cross.

Current Level: 0.5685
Support: 0.5650
Resistance: 0.5740
Last week’s range: 0.5682- 0.5734

The British Pound (GBP) rallied back Monday to 2.0560 (0.4865) against the New Zealand Dollar (NZD) after trading around the 2.0400 (0.4900) areas late in the week. Clearing the 50-day moving average at 2.0510 (0.4875) we see further upside to come for the GBP. Tomorrow’s RBNZ meeting should reflect a “hold” on interest rates at 5.50% which could bring about further selling in the kiwi. We have nothing on the UK calendar this week.

Current Level: 2.0563
Resistance: 2.0650
Support: 2.0400
Last Weeks Range: 2.0372- 2.0578

The British Pound (GBP) rallied back Monday to 2.0560 (0.4865) against the New Zealand Dollar (NZD) after trading around the 2.0400 (0.4900) areas late in the week. Clearing the 50-day moving average at 2.0510 (0.4875) we see further upside to come for the GBP. Tomorrow’s RBNZ meeting should reflect a “hold” on interest rates at 5.50% which could bring about further selling in the kiwi. We have nothing on the UK calendar this week.

Current Level: 0.4863
Resistance: 0.4900
Support: 0.4840
Last Weeks Range: 0.4859- 0.4908

The New Zealand Dollar (NZD) slid to 0.9410 (1.0630) against the Australian Dollar (AUD) Monday but retraced and moved back to 0.9450 (1.0580) early Tuesday. A failed attempt at a reversal leaves the current bull trend in place. More upside for the kiwi look to be the likely scenario over the coming days. Tomorrow early afternoon we will get a flurry of excitement when Aussie CPI y/y is released followed 30 minutes later with the RBNZ rate announcement. Aussie CPI is predicted to come in above the current 3.4% while the jury is out on whether the RBNZ may hike from 5.50%. We think they will hold for now. Key resistance in the cross is around 0.9550 (1.0470) the 2 years high.

Current Level: 1.0590
Resistance: 1.0800
Support: 1.0470
Last Weeks Range: 1.0569- 1.0665