NZD

FX News

NZD/USD Transfer

Downside pressures in the New Zealand Dollar (NZD) eased slightly Monday against the US Dollar (USD) with price settling around the weekly open at 0.5925 this morning. With Fed’s Powell expected to deliver a hawkish speech later this week at the Jackson Hole event around how much interest rates could go in order to drag down inflation his comments may spook the markets. After all, recently we have been prepped for interest rate cuts in 2024 something markets had originally been forecasting to happen as soon as late this year. Rhetoric suggesting the fight against inflation is “far from over’ will most likely be the theme. NZ Retail Sales prints tomorrow, predicted to come in poor and later this week we have US consumer sentiment.

Current Level: 0.5927
Resistance: 0.6400
Support: 0.5900
Last Weeks Range: 0.5901 – 0.5994

FX News

FX Update: China worries markets

Market Overview

Key Points:

• The New Zealand Dollar and Australian Dollar have both kicked off the week wobbly based on last week’s bearish pressures.
• The New Zealand Trade deficit widened from 0.11B to 1.11B in July as imports dropped 16% and exports fell 14%
• German producer prices fell 1.1% m/m for July vs 0.1% expected.
• US Treasury yields rise again, the 10-year bond rising to a 2007 high.
• Latest signs are that the Bank of Canada (BoC) will remain on hold at the September meeting.
• Chinese growth forecast for 2023 shifts from 5.2% to 4.8%, meanwhile the People’s Bank of China (PBOC) cuts their prime 1-year rate to 3.45% from 3.55% – no cut to the 5 year came as a surprise.
• The British Pound (GBP) has been the strongest currency this week with the Australian Dollar (AUD) the worst performer.

Major Announcements last week:
• Chinese Retail Sales y/y 2.5% vs 4.2% expected
• US Retail Sales for July 0.7% vs 0.4%
• RBNZ retain cash rate at 5.5%
• UK CPI y/y 6.8% vs 6.7% predicted
• Australia unemployment rate 3.7% up from 3.6%

FX News

NZD/EUR Transfer

As we suggested earlier in the week- The New Zealand Dollar (NZD) has notched up another week of declines with price reaching 0.5435 (1.8400) against the Euro (EUR). The RBNZ left the cash rate on hold at 5.50% with hawkish rhetoric suggesting they could yet hike depending on how data flows in. Also of note is the broad based “risk flow” hampering the NZD with equity markets all softening. The Eurozone grew by a modest 0.3% in the second quarter of 2023, slightly up on the first quarter’s 0.2% with Ireland making waves with their solid 3.3% the largest in the eurozone. Buy the EUR on any spike.

The current interbank midrate is: NZDEUR 0.5451   EURNZD 1.8345

The interbank range this week has been: NZDEUR 0.5435- 0.5493   EURNZD 1.8202- 1.8398

FX News

NZD/GBP Transfer

Inflation in the UK improved to 6.8% y/y down from 7.9% in June coming in bang on expectations. It’s good news for the Bank of England (BoE) however they still have work to do in order to bring down inflation further. The central bank should raise rates next month 50 basis points instead of the earlier 0.25% consensus. The New Zealand Dollar (NZD) extended its bear run over the week to clock 0.4870 (2.1530) breaking past March 2020 support, the next support is 0.4140 (2.4170), we think it will be one way traffic for a while yet.

The current interbank midrate is: NZDGBP 0.4652 GBPNZD 2.1496

The interbank range this week has been: NZDGBP 0.4644- 0.4724 GBPNZD 2.1168- 2.1533

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

Different week- same result, in the New Zealand Dollar (NZD), US Dollar (USD) cross with the kiwi slipping again to fresh lows around 0.5930 levels. Well under the 0.6000 support line now it’s hard to see the NZD bouncing back with any gusto. The Reserve Bank of New Zealand confirmed they are happy with the current cash rate at 5.50% which has been constraining spending and inflation pressures. Fed minutes suggested they are hanging off rises in unemployment and slower growth in order to bring down inflation to target levels with a recession now on the cards later this year. On the chart the NZD looks into the abyss all the way to 0.5550.

The current interbank midrate is: NZDUSD 0.5936

The interbank range this week has been: NZDUSD 0.5903- 0.5997

FX News

Key Points This Week

FX Update

Key Points:

  • The Reserve Bank of New Zealand holds interest rates at 5.50%
  • Japanese “core-core” inflation – (excluding food and energy) rises to 4.3%
  • Gold has fallen to the lowest level since March- 1980 per ounce.
  • Chinese Industrial production released down on expectations in the second quarter, with domestic indicators like real estate and demand for exports also taking hits.
  • The US 30-year bond traded to 4.42% overnight breaking above last year’s high and matching 2011 levels. This is starting to weigh on equity markets with US indices all coming off recent highs.
  • The British Pound (GBP) has been the strongest currency this week with the Australian Dollar (AUD) the worst performer.
FX News

NZD/USD Transfer

The New Zealand Dollar (NZD) continued its downward spiral late last week reaching 0.5980 closing below key support at the big figure- 0.6000 against the US Dollar (USD). Monday’s action has extended moves to the downside clocking 0.5950 in early Tuesday. To be honest, the kiwi looks “down for the count” at the moment trading into thin air through 0.6000 was a major signal we could see bigger moves into the 0.50’s. It’s a busy week of releases for the pair with a slew of data to publish. The RBNZ official cash rate is expected to hold rates at 5.50% followed by Fed minutes Thursday. At some point the NZD will bounce higher, buyers of USD should grab the spikes.

Current Level: 0.5974
Resistance: 0.6360
Support: 0.5930
Last Weeks Range: 0.5974 – 0.6117

FX News

EURO/AUD Transfer

Mid last week, prices in the Euro (EUR), Australian Dollar (AUD) cross fell through long term support at 0.5960 (1.6780) to reach 0.5930 (1.6860) at the close. Trading into Monday extended this run to 0.5910 (1.6930) before reversing to 0.5950 (1.6815) early Tuesday. If we look back 1 year on the chart to August 2022 we see a familiar pattern of lower highs followed by lower lows constantly repeating. Looking ahead we see Australian employment data Thursday with unemployment expected to tick higher from 3.6%.

Current Level: 1.6815
Resistance: 1.7200
Support: 1.6650
Last Weeks Range: 1.6685 – 1.6884

FX News

AUD/EURO Transfer

Mid last week, prices in the Euro (EUR), Australian Dollar (AUD) cross fell through long term support at 0.5960 (1.6780) to reach 0.5930 (1.6860) at the close. Trading into Monday extended this run to 0.5910 (1.6930) before reversing to 0.5950 (1.6815) early Tuesday. If we look back 1 year on the chart to August 2022 we see a familiar pattern of lower highs followed by lower lows constantly repeating. Looking ahead we see Australian employment data Thursday with unemployment expected to tick higher from 3.6%.

Current Level: 0.5947
Resistance: 0.6000
Support: 0.5815
Last Weeks Range: 0.5922 – 0.5993