NZD

FX News

FX Update: Risk assets hold ground

Market Overview

Key Points:

• Bank of America is forecasting 75 points of rate cuts in 2024, the first around June.
• US authorities are becoming increasingly sure that Wagner boss Prigozhin has died in the recent plane crash.
• Former US president Donald Trump’s trial for election interference has been set for 4th March 2024
• China has ditched the last of their travel restrictions with travellers not having to take a test 48 hours prior to entry into the country.
• The US Dollar (USD) has been the strongest currency over the month of August with the New Zealand Dollar (NZD) underperforming, the worst performer.

Major Announcements last week:
• US Home Sales q/q -1.0% vs -1.6% previous
• UK Manufacturing drops to 6 month low
• UoM Consumer Sentiment 69.5 vs 71.2
• French Manufacturing 46.4 in July vs 42.8 predicted

FX News

NZD/AUD Transfer

As we said earlier the Australian Dollar (AUD) came under pressure, but it wasn’t until late Wednesday we saw a shift off 0.9210 (1.0860) levels back to 0.9235 (1.0830). NZ Retail Sales disappointed in the June quarter coming in at -1.0% vs -0.4% the 3rd consecutive decline representing consumers leaving money in their pocket, the biggest contributor being food and beverage with the sector struggling. On the whole, the pair remains well within recent ranges. Next week’s economic docket looks super thin, more of the same looks to be the likely theme.

The current interbank midrate is: NZDAUD 0.9225    AUDNZD 1.0833

The interbank range this week has been: NZDAUD 0.9192- 0.9266    AUDNZD 1.0792- 1.0879

FX News

NZD/USD Transfer

The New Zealand Dollar (NZD) has mostly hovered around 0.5920 over the week against the US Dollar (USD) with a short trip to 0.5980 Thursday as equities recovered. Overall, the cross looks very bearish as its peers over the precipice. NZ Retail Sales missed forecast at -1.0% vs -0.4% expected the third time in a row, supporting the pull back in consumer spending of late. US New Home sales, weekly unemployment both helped the greenback, however with upcoming talks from Fed chair Powell at the Jackson Hole Symposium on future rate predictions, we could see the Fed head in a different direction quick.

The current interbank midrate is: NZDUSD 0.5917

The interbank range this week has been: NZDUSD 0.5896- 0.5985

FX News

NZD/GBP Transfer

The New Zealand Dollar (NZD) broke out of its recent bear channel this week recovering losses to 0.4700 (2.1280) into Friday sessions against the British Pound (GBP). We are not convinced this flurry will continue with fundamentals stacked in favour of further Pound moves. NZ Retail Sales printed down on expectations at -1.0% in the June quarter compared to -0.4% expected. This is the third straight quarter of poor data reflecting lower consumer spending. UK manufacturing also came in lower, confirming a renewed downturn in business activity. Next week’s thin calendar could see the kiwi slip.

The current interbank midrate is: NZDGBP 0.4699    GBPNZD 2.1281

 

The interbank range this week has been: NZDGBP 0.4632- 0.4797    GBPNZD 2.0846- 2.1588

FX News

Key Points This Week

Market Overview:

Key Points:

• The Jackson Hole Symposium gets under way in Wyoming attended by central bankers and financial participants around the world.
• Canadian Retail Sales edged up 0.1% in June from 0.0% expectations confirming a rebound in activity.
• Eurozone services data comes in weak easing concerns over whether the ECB may raise rates in September. ECB’s governing council Nagal says the labour market is strong and it’s too early to consider halting hikes. He also said he doesn’t expect a recession in the near future.
• Japanese CPI for August comes in at 2.9% after 2.0% was predicted.
• High US inflation has put pressure on the Fed with current policy, this in turn is increasing pressure on US industry with a high USD currency. These companies who rely on US profits and foreign receipts are struggling.
• The Australian Dollar (AUD) is the strongest currency this week with the British Pound (GBP) the worst performer.

FX News

EURO/AUD Transfer

The Australian Dollar (AUD), British Pound (GBP) entered Tuesday around the weekly opening level of 0.5030 (1.9880) after flatlining mid last week. The Aussie still looks to be struggling post ongoing Chinese economic fears and a higher UK inflation read. Precious metal prices also have the AUD on the backfoot along with a disappointing wage report. This week’s UK manufacturing Wednesday is predicted to come in light which may give the Aussie investors more to cheer about.

Current Level: 1.6989
Resistance: 1.7095
Support: 1.6275
Last Weeks Range: 1.6736 – 1.7063

FX News

AUD/EURO Transfer

The Australian Dollar (AUD), Euro (EUR) cross looks to be resting around the 0.5885 (1.7000) mark into Tuesday after another big week of declines in the Aussie from 0.5935 (1.6850) areas from the start of last week. The pair trades just above the April 2020 low, the downward channel still in play, a retest of 0.5815 (1.7200) looks like the play this week amid a thin data calendar.

Current Level: 0.5886
Resistance: 0.6145
Support: 0.5850
Last Weeks Range: 0.5860 – 0.5975

FX News

GBP/AUD Transfer

The Australian Dollar (AUD), British Pound (GBP) entered Tuesday around the weekly opening level of 0.5030 (1.9880) after flatlining mid last week. The Aussie still looks to be struggling post ongoing Chinese economic fears and a higher UK inflation read. Precious metal prices also have the AUD on the backfoot along with a disappointing wage report. This week’s UK manufacturing Wednesday is predicted to come in light which may give the Aussie investors more to cheer about.

Current Level: 1.9892
Resistance: 2.000
Support: 1.8975
Last Weeks Range: 1.9488 – 1.9966

FX News

AUD/GBP Transfer

The Australian Dollar (AUD), British Pound (GBP) entered Tuesday around the weekly opening level of 0.5030 (1.9880) after flatlining mid last week. The Aussie still looks to be struggling post ongoing Chinese economic fears and a higher UK inflation read. Precious metal prices also have the AUD on the backfoot along with a disappointing wage report. This week’s UK manufacturing Wednesday is predicted to come in light which may give the Aussie investors more to cheer about.

Current Level: 0.5027
Resistance: 0.5270
Support: 0.5000
Last Weeks Range: 0.5008 – 0.5131

FX News

AUD/USD Transfer

The Australian Dollar (AUD) held firm around the 0.6425 area post the open against the USD Dollar (USD) Monday as equity markets traded positive. It’s hard to know if we will see a reversal of sorts this week and a push higher, but with improved sentiment in China after an improved May manufacturing PMI read who knows. Australian Retail Sales came in hot at 0.5% in July after a poor June release surprising analysts as shoppers came out during the FIFA Women’s World Cup. Despite this the RBA is still likely to raise rates at the September 5 meeting. Looking ahead we have US Non-Farm Payroll Friday which will add volatility to the mix.

Current Level: 0.6432
Resistance: 0.6365
Support: 0.6500
Last Weeks Range: 0.6385 – 0.6488