NZD

It’s been all one-way traffic in the New Zealand Dollar (NZD), Euro (EUR) cross this week extending off 1.7800 (0.5620) the weekly open to 1.8070 (0.5535) in morning trade the kiwi coming under enormous pressures after the RBNZ cut interest rates half a cent yesterday off 5.25% to 4.75%. The cut was widely predicted however although much of the downside momentum in the NZD was priced in, more sellers of NZD come forward post the release. On the chart the kiwi has slipped past prior support at 0.5555 (1.80) and could retest early July levels circa 0.5510 (1.8150) in the coming days. We haven’t seen much on the Euro calendar this week, much of the focus has been on the German govt updating their GDP forecast which is predicted to be a negative number when it prints at the end of this month.

Current Level: 0.5542
Support: 0.5520
Resistance: 0.5660
Last week’s range: 0.5606- 0.5720

The Kiwi attracted sellers in the wake of the RBNZ cut Wednesday after the RBNZ cut the interest rate from 5.25% to 4.75%. Price extended to 0.4630 (2.1585) clearing support around 0.4660 (2.1470), the lowest level since early August levels against the British Pound (GBP). Inflation in NZ sits at 3.3% y/y for the June quarter just above the 1-3% acceptable band. Seems the RBNZ are now convinced inflation is under control with convincing signs its rapidly approaching the mid zone around 2%. Markets are pricing in another 50-point drop at the November meeting which would take the interest rate to 4.25% giving more relief to borrowers and consumers. The cross looks to retest the yearly low at 0.4580 (2.1840).

Current Level: 2.1547
Resistance: 2.1880
Support: 2.1000
Last Weeks Range: 2.1000- 2.1311

The Kiwi attracted sellers in the wake of the RBNZ cut Wednesday after the RBNZ cut the interest rate from 5.25% to 4.75%. Price extended to 0.4630 (2.1585) clearing support around 0.4660 (2.1470), the lowest level since early August levels against the British Pound (GBP). Inflation in NZ sits at 3.3% y/y for the June quarter just above the 1-3% acceptable band. Seems the RBNZ are now convinced inflation is under control with convincing signs its rapidly approaching the mid zone around 2%. Markets are pricing in another 50-point drop at the November meeting which would take the interest rate to 4.25% giving more relief to borrowers and consumers. The cross looks to retest the yearly low at 0.4580 (2.1840).

Current Level: 0.4641
Resistance: 0.4760
Support: 0.4570
Last Weeks Range: 0.4692- 0.4762

The RBNZ delivered a 50-point cut to their interest rate yesterday as predicted sending the New Zealand Dollar (NZD) lower across the board and towards 0.9020 (1.1085) against the Australian Dollar (AUD). We have been suggesting for several weeks now how the kiwi looks overvalued. Turns out we have been correct; prices could drop into the high 80’s prior to the weekly close. Also factoring in another 50-point cut by the RBNZ at their late November meeting we could see the NZD continue to sell off.

Current Level: 1.1066
Resistance: 1.1150
Support: 1.1030
Last Weeks Range: 1.0864 – 1.1048

The RBNZ delivered a 50-point cut to their interest rate yesterday as predicted sending the New Zealand Dollar (NZD) lower across the board and towards 0.9020 (1.1085) against the Australian Dollar (AUD). We have been suggesting for several weeks now how the kiwi looks overvalued. Turns out we have been correct; prices could drop into the high 80’s prior to the weekly close. Also factoring in another 50-point cut by the RBNZ at their late November meeting we could see the NZD continue to sell off.

Current Level: 0.9029
Resistance: 0.9070
Support: 0.8970
Last Weeks Range: 0.9051 – 0.9204

The New Zealand Dollar (NZD) has sunk to 0.6055 in morning trading against the US Dollar (USD) after some intense selling pressures. The Reserve Bank of New Zealand (RBNZ) cut interest rates by 0.50% to 4.75% yesterday. It’s clear now that the New Zealand economy is weakening significantly, however the RBNZ suggested inflation would return to the mid 1-3% target soon. Markets expect the central bank to reduce interest rates again at their November 27 meeting. We don’t see a lot of support on the chart down to 0.5850 levels- the late July low. If the kiwi can stay above 0.6000 for the next couple of days it will be a small miracle.

Current Level: 0.6066
Support: 0.6000
Resistance: 0.6200
Last week’s range: 0.6144- 0.6379

Resistance around 0.4760 (2.1000) held early week for the British Pound (GBP) the New Zealand Dollar (NZD) diving to 0.4710 (2.1240) Thursday amid a market “risk off” tone before reversing all the way back to 0.4750 (2.1060). With no tier one data publishing in the cross moves have been dominated by geopolitical flows following Iran’s attack on Israel. NZ ANZ Business Confidence jumped in September with optimism improving over the last few months. Next week’s RBNZ meeting should see a cut of 50 points to 4.75%, while most of this could already be priced into the cross we could still get a drop in the NZD.

The current interbank midrate is: NZDGBP 0.4735 GBPNZD 2.1119

The interbank range this week has been: NZDGBP 0.4706- 0.4761 GBPNZD 2.1000- 2.1249

The New Zealand Dollar (NZD) has fallen out of bed this week against the US Dollar (USD) posting numbers around low 0.62’s this morning. At the start of the week the cross actually rose reaching 0.6380 before dropping on geopolitical uncertainty. Attention shifts today to the US Non-Farm Payroll (NFP) release and unemployment rate. If the report shows a weaker than predicted outcome we could see the Federal Reserve (Fed) consider cutting rates deeper in the coming months putting big pressure on the greenback. The kiwi may be relief around 0.6200 with strong support seen on the chart.

The current interbank midrate is: NZDUSD 0.6216

The interbank range this week has been: NZDUSD 0.6206- 0.6378

As we predicted the Australian Dollar (AUD) has held up well against the New Zealand Dollar (NZD) moving well outside recent ranges around 0.9140 (1.0940) and 0.9215 (1.0850) to clock 0.9070 (1.1025) in morning trade. Central bank divergence evident with the RBA suggesting no cuts until early 2025 while the RBNZ now forecast 2 cuts of 50 points on October 9th and again in November. Australian Retail Sales boosted the Aussie when figures for August published at 0.7% vs 0.4% expected. We predict now is the time we could see cross fall deep into the 80’s. Next week’s potential RBNZ cut to 4.75% won’t help the kiwi.

The current interbank midrate is: NZDAUD 0.9080 AUDNZD 1.1007

The interbank range this week has been: NZDAUD 0.9071- 0.9201 AUDNZD 1.0868- 1.1023

French budget woes and softer German prelim CPI m/m have both contributed to the Euro (EUR) demise over the past few days against the Australian Dollar (AUD) sending prices in the cross to 0.6220 (1.6080) in morning trade. A retest and break above 0.6250 (1.6000) the 2024 high would signal further upside for the AUD. With the RBA holding tight on easing policy until next year we could certainly see more of the same.

Current Level: 1.6108
Resistance: 1.6600
Support: 1.6000
Last Weeks Range: 1.6116- 1.6402