USD

The New Zealand Dollar (NZD) has failed to hold prices around 0.5600 (1.7850) against the Euro (EUR) at the start of the week falling back to 0.5555 (1.8000) in stiff risk off markets. Geopolitical uncertainty following the missile/drone strikes on Iran by Israel certainly could have been a lot worse with only a moderate sell-off in the kiwi. The only data this week of note in the cross is NZ CPI q/q with predictions of a 0.6% rise in prices in the March quarter. This should see the annual number dip to around 4.3% from 4.7% and subsequently put more downward pressure on the NZD.

Current Level: 0.5554
Support: 0.4725
Resistance: 0.54780
Last week’s range: 0.4754- 0.4795

Risk sentiment pushed the New Zealand Dollar (NZD) lower Monday to 0.4740 (2.1090) against the British Pound (GBP), the latest dip could have been a whole lot worse with the escalation in the Middle East not as bad as first feared. Both NZ and UK inflation releases tomorrow with expectation of a tick lower in both the UK figure and NZ prints. We expect a retest of the support zone around 0.4725 (2.1170) the September 2023 low.

Current Level: 2.1088
Resistance: 2.1170
Support: 2.0900
Last Weeks Range: 2.0856- 2.1033

Risk sentiment pushed the New Zealand Dollar (NZD) lower Monday to 0.4740 (2.1090) against the British Pound (GBP), the latest dip could have been a whole lot worse with the escalation in the Middle East not as bad as first feared. Both NZ and UK inflation releases tomorrow with expectation of a tick lower in both the UK figure and NZ prints. We expect a retest of the support zone around 0.4725 (2.1170) the September 2023 low.

Current Level: 0.4742
Resistance: 0.4785
Support: 0.4725
Last Weeks Range: 0.4754- 0.4795

The Australian Dollar (AUD) bounced back against the New Zealand Dollar (NZD) at the start of the week partially reversing last week’s gains to 1.0910 (0.9165). The Aussie continuing its 8-week run against the unfavourable NZD. The next stop is the prior low at 0.9130 (1.0950) however this week’s key data could derail the AUD bulls. NZ inflation Wednesday should reflect a rise to the March quarter of 0.8%, year on year, this should represent a fall from 4.7% to approximately 4.3%. With the rise in the March quarter the RBNZ could see this as “forecasts lie to the upside” thus supporting the NZD. Aussie employment figures Thursday could surprise higher.

Current Level: 1.0909
Resistance: 1.0950
Support: 1.0860
Last Weeks Range: 1.0873- 1.0950

The Australian Dollar (AUD) bounced back against the New Zealand Dollar (NZD) at the start of the week partially reversing last week’s gains to 1.0910 (0.9165). The Aussie continuing its 8-week run against the unfavourable NZD. The next stop is the prior low at 0.9130 (1.0950) however this week’s key data could derail the AUD bulls. NZ inflation Wednesday should reflect a rise to the March quarter of 0.8%, year on year, this should represent a fall from 4.7% to approximately 4.3%. With the rise in the March quarter the RBNZ could see this as “forecasts lie to the upside” thus supporting the NZD. Aussie employment figures Thursday could surprise higher.

Current Level: 0.9162
Resistance: 0.9210
Support: 0.9130
Last Weeks Range: 0.9132- 0.9197

Profit taking on short positions halted the New Zealand Dollar (NZD) from further declines Monday momentarily after the currency came off Friday and into the weekend to 0.5930 areas against the US Dollar (USD). Attacks on Israel from Iran air strikes sent markets into a spin as we all wondered how Israel would counter. With prices down further overnight around 0.5900 heading into Tuesday this represents a huge 2024 low pushing past the prior low at 0.5940 after a higher than forecast March US Retail Sales print. This week’s NZ CPI should reflect a decent dip from 4.7% from 4.3%, anything lower and we could see more downside moves in the kiwi.

Current Level: 0.5904
Support: 0.5800
Resistance: 0.6000
Last week’s range: 0.5933- 0.6082

The New Zealand Dollar (NZD) extended moves from last week’s 0.4725 ( 2.1160) against the English Pound (GBP) posting a fresh 3 week high of 0.4770 (2.0860). The RBNZ kept interest rates on hold at 5.5% Wednesday pushing the kiwi lower to 0.4765 (2.0990). The central bank saying a restrictive policy was still required in efforts to drag down inflation back to a 1-3% target band. The December quarter CPI released at 4.7% but the RBNZ still has a way to go as they remain cautious in the face of stubborn inflation. Personally, we believe the bank should be cutting rates in the late May meeting.

The current interbank midrate is: NZDGBP 0.4778 GBPNZD 2.0929

The interbank range this week has been: NZDGBP 0.4754- 0.4794 GBPNZD 2.0856- 2.1033

The New Zealand Dollar (NZD) shrugged off last week’s losses pushing back above 0.6000 posting a new high midweek of 0.6080 against the US Dollar (USD). This little run up wasn’t to last falling sharply as US inflation data came in, the cross retreating to 0.5965 levels. CPI came in higher than forecast of 3.4% y/y at 3.5%. This is the third straight month prices have increased above expectations. The Fed now will dial back interest rate cuts predicted earlier this year. Inflation cooled at the end of 2023, but the Fed now seems less confident they will see levels around 2.0% targets in 2024 making for a slower pace of cuts. Earlier the Reserve Bank of New Zealand (RBNZ) held interest rates unchanged at 5.5% as widely expected the 6th meeting in a row. The RBNZ said they were confident by leaving rates unchanged will return the inflation rate back to a 1-3% target band within 2024. We are a little surprised at the optimism showed by the RBNZ with growth weak and unemployment about to plunge. Overall direction in the cross is still to the downside.

The current interbank midrate is: NZDUSD 0.6001

The interbank range this week has been: NZDUSD 0.5964- 0.6082

The current interbank midrate is: NZDAUD 0.9175 AUDNZD 1.0893

The interbank range this week has been: NZDAUD 0.9133- 0.9197 AUDNZD 1.0872- 1.0949