NZD

The Euro (EUR) was slayed last week falling to 1.6450 (0.6080) levels against the Australian Dollar (AUD) as risk on flow demand stimulates the AUD. The cross wasn’t able to kick on past long-term support at 0.6080 (1.6450), bouncing back towards 0.6050 (1.6530) this morning. ECB’s Holzmann said the ECB must be prepared to raise interest rates again if needed, confirming that rates would not be cut any time soon. The ECB left rates unchanged in late October after 10 consecutive hikes. Today’s RBA meeting will confirm a hike in their interest rate from 4.10% to 4.35%. We expect a retest of 0.6080 (1.6450).

Current Level: 0.6053
Resistance: 0.6075
Support: 0.6025
Last Weeks Range: 0.5966 – 0.6067

The Bank of England’s (BoE) hawkish tone saw the Pound (GBP) extend Friday’s direction Monday to 0.5235 (1.9100) against the Australian Dollar (AUD) before dropping back to 0.5255 (1.9030) It can be said the Bank of England hadn’t considered cutting rates last week with persistence inflation a worry. The vote a 6-3 hold split with the central bank upgrading their inflation forecast. This week’s focus is on today’s RBA cash rate announcement with predictions the RBA will hike to 4.35% from 4.10% ending 4 meetings of holds. This will be the new governor Michele Bullock’s first hike since taking over recently. In theory we should see Aussie strength today, currently 0.5255 (1.9030) pushing higher in the last few hours.

Current Level: 1.9025
Resistance: 1.9190
Support: 1.8940
Last Weeks Range: 1.8896 – 1.9203

The New Zealand Dollar (NZD) reversed off the triple bottom at 0.5480 (1.8250) last week to climb back to 0.5585 (1.7900) levels at the weekly close against the Euro (EUR). An outflow of US Dollar flows supporting the kiwi in the aftermath of last week’s US NFP data. The Fibonacci 50% retracement 0.5600 (1.7875) from the recent high at 0.5715 (1.7500) and the low at 0.5480 (1.8250) looks to be favouring a technical move lower.

Current Level: 1.7988
Resistance: 1.8250
Support: 1.7875
Last Weeks Range: 1.7877 – 1.8250

The New Zealand Dollar (NZD) reversed off the triple bottom at 0.5480 (1.8250) last week to climb back to 0.5585 (1.7900) levels at the weekly close against the Euro (EUR). An outflow of US Dollar flows supporting the kiwi in the aftermath of last week’s US NFP data. The Fibonacci 50% retracement 0.5600 (1.7875) from the recent high at 0.5715 (1.7500) and the low at 0.5480 (1.8250) looks to be favouring a technical move lower.

Current Level: 0.5559
Support: 0.5480
Resistance: 0.5600
Last week’s range: 0.5479 – 0.5593

Price in the New Zealand Dollar (NZD), British Pound (GBP) moved off the 0.4845 (2.0640) open to reach 0.4810 (2.0780) in early Tuesday trading. The risk on drivers is still evident in the aftermath of Friday’s US Non-Farm release. Also of note was UK services PMI which beat predictions and a hawkish Bank of England. This week’s NZ inflation expectations tomorrow which gives us a review of predictions for the next 2 years could be interesting. UK GDP m/m prints Friday. The kiwi will be eying 0.4850 (2.0615) this week.

Current Level: 2.0716
Resistance: 2.0940
Support: 2.0600
Last Weeks Range: 2.0563- 2.0972

Price in the New Zealand Dollar (NZD), British Pound (GBP) moved off the 0.4845 (2.0640) open to reach 0.4810 (2.0780) in early Tuesday trading. The risk on drivers is still evident in the aftermath of Friday’s US Non-Farm release. Also of note was UK services PMI which beat predictions and a hawkish Bank of England. This week’s NZ inflation expectations tomorrow which gives us a review of predictions for the next 2 years could be interesting. UK GDP m/m prints Friday. The kiwi will be eying 0.4850 (2.0615) this week.

Current Level: 0.4827
Resistance: 0.4855
Support: 0.4775
Last Weeks Range: 0.4768 – 0.4863

RBA and Melbourne Cup Day. The RBA is expected to hike interest rates from 4.10% to 4.35% later today after a 4-meeting pause. The New Zealand Dollar (NZD), Australian Dollar (AUD) cross has been bouncing around recent levels circa 0.9215 (1.0850) this week after falling to 0.9140 (1.0940) last week as risk flow benefited the AUD. The RBA efforts are to achieve a 2-3% inflation target by the end of 2025 and today they may signal further hiking if they see it necessary. In other key data is NZ quarterly inflation expectations Wednesday, anything above 2.83% could send the kiwi higher. No 1 is our pick in the Cup at 5.05 NZT

Current Level: 1.0882
Resistance: 1.0940
Support: 1.0820
Last Weeks Range: 1.0842 – 1.0941

RBA and Melbourne Cup Day. The RBA is expected to hike interest rates from 4.10% to 4.35% later today after a 4-meeting pause. The New Zealand Dollar (NZD), Australian Dollar (AUD) cross has been bouncing around recent levels circa 0.9215 (1.0850) this week after falling to 0.9140 (1.0940) last week as risk flow benefited the AUD. The RBA efforts are to achieve a 2-3% inflation target by the end of 2025 and today they may signal further hiking if they see it necessary. In other key data is NZ quarterly inflation expectations Wednesday, anything above 2.83% could send the kiwi higher. No 1 is our pick in the Cup at 5.05 NZT

Current Level: 0.9180
Resistance: 0.9245
Support: 0.9140
Last Weeks Range: 0.9139 – 0.9223

The New Zealand Dollar (NZD) rose over 2.5% last week against the US Dollar (USD) clocking 0.6000 as the greenback was heavily sold post US employment data publishing. The number of new people entering the workforce shrank with just 150,000 instead of 178,000 expected and the unemployment rate rose from 3.8% to 3.9%. As we suggested we got plenty of NZD upside ending the week as punters exited the USD, however the cross has stalled in the run up to 0.6000 eased back to 0.5960 into early Tuesday. NZ Inflation expectations print tomorrow but for now we eye today’s Melbourne Cup.

Current Level: 0.5960
Resistance: 0.6040
Support: 0.5800
Last Weeks Range: 0.5787 – 0.6000

Market Overview

• Waves of US Dollar selling continued at the start of the week with demand for risk products following last week’s Non-Farm Payroll release.
• ECB’s Lagarde says she is determined to bring down inflation to 2.0% and suggests this will happen in 2025.
• Ex vice Fed chair Brainard is forecasting to take US recession calls off the table after last week’s “sustainable” jobs data.
• Markets are pricing in a Bank of Canada rate cut as early as next April with end of 2024 inflation expectations at 2.2%
• The conflict in Gaza death toll has exceeded 10,000 with more than 4,000 of these children. Jordan says it is leaving options open after Israel’s failure to separate between civilians and military targets.
• The New Zealand Dollar (NZD) has been the strongest currency this month while the US Dollar (USD) has been the worst performer.