AUD/USD Transfer:

The Australian Dollar (AUD) continued its run lower against the US Dollar (USD) as the week progressed clocking 0.6745 this morning as risk conditions soured. Dovish RBA minutes and poor data out of China weakened the AUD weighing on global sentiment. Fed’s Powell testified saying they have quite a way to go to bring down inflation but are making progress. He also suggested the economic recovery from the covid pandemic has been the strongest among the developed countries. They will likely raise rates in the coming months after holding steady last week, the downside is they may see a sharper than anticipated slowdown which could threaten a recession. Looking ahead we have Australian CPI y/y Thursday.

The current interbank midrate is: AUDUSD 0.6764
The interbank range this week has been: AUDUSD 0.6739- 0.6882

AUD/GBP Transfer:

This more aggressive Bank of England (BoE) interest rate release sent the Australian Dollar (AUD) back to 0.5290 (1.8900) this morning extending recent GBP moves to a two-week low. The central bank hiked 50 points to 5.0% as they move to try and bring down soaring inflation. Earlier UK inflation came in above expectation at 8.7% year on year after 8.4% was forecast, an unchanged shock result. This is a real problem for the Bank of England, the result beating out lower expectations the 4th month in a row. Further interest rate rises by the central bank in August/September are now likely. The carry trade is likely to be more evident and GBP supportive. Next week’s docket is thin with just Australian CPI y/y releasing, anything north of 6.8% may boost the AUD.

The current interbank midrate is: AUDGBP 0.5307 GBPAUD 1.8843
The interbank range this week has been: AUDGBP 0.5291- 0.5380 GBPAUD 1.8587- 1.8897

NZD/AUD Transfer:

The New Zealand Dollar (NZD) held its ground surprisingly recovering recent losses against the Australian Dollar (AUD) on its way to a peak at 0.9175 (1.0900). Chinese economic outlook put the Aussie under pressure as well as a less hawkish RBA. The central bank said the rate increase a week ago was finely balanced based on pressures in rising wage growth. Inflation risks are still slanted to the upside with the door open for further hikes. Next week’s Australian CPI y/y will give us more clues on where the cross is headed, anything larger than the current 6.8% may improve the AUD.

The current interbank midrate is: NZDAUD 0.9147 AUDNZD 1.0925
The interbank range this week has been: NZDAUD 0.9048- 0.9170 AUDNZD 1.0904- 1.1051

NZD/USD Transfer:

Big Dollar strength has been the theme over the week with the New Zealand (NZD) drifting lower Friday to 0.6170 levels. We did see 0.6220 midweek after Westpac NZ consumer confidence released better than expected with second quarter data rising to 83.1 from 77.7 previously, however this is still well below the average. Also, of note- Powell’s testimony weakened the USD after saying inflation remains sticky and could rise further. Markets are predicting only 1 further hike from the Fed, but the Fed has two planned. Two hikes we believe would almost certainly put the US economy into recession. Chinese Outlook soured markets Thursday taking equity markets lower and the kiwi with it. The kiwi is looking soft, keeping above 0.6000 will require effort.

The current interbank midrate is: NZDUSD 0.6189
The interbank range this week has been: NZDUSD 0.6133- 0.6237

AUD/EUR Transfer:

The Australian Dollar (AUD) was the strongest currency last week against the main board but made no move against the Euro (EUR). Perhaps consolidating after a massive two weeks of gains. Bouncing around the 0.6275 (1.5940) for most of the week from 0.6055 (1.6520) in late May. Villeroy didn’t help the Euro after he made dovish comments saying that inflation had peaked and the ECB may not hike further. With the recent slide in US equities, we may see the EUR pick up ground this week and stage a reversal of sorts towards 0.6210 (1.6100), this will mostly hinge on Eurozone manufacturing data late in the week.

Current Level: 0.6271 (1.5946)
Resistance: 0.6300 (1.6200)
Support: 0.6170 (1.5880)
Last Weeks Range: 0.6252-0.6309 (1.5848-1.5993)

AUD/GBP Transfer:

The British Pound (GBP) ground out gains Monday off the open to extend last week’s mini rally against the Australian Dollar (AUD) to 0.5335 (1.8750). The GBP improved from the recent hawkish tone from the BoE and rate hike predictions. Recent wage data and claimant change has firmed the rate hike outlook. Profit taking post last week’s “risk rises” has been evident with the AUD falling back a tad as equities have also eased form recent highs. This week’s y/y UK CPI and official cash rate announcement is the main ticket. Interest rates are expected to be raised from 4.50% to 4.75% as they fight to conquer rising inflation. Momentum we think is to the downside in the cross this week.

Current Level: 0.5352 (1.8684)
Resistance: 0.5420 (1.9180)
Support: 0.5215 (1.8440)
Last Weeks Range: 0.5348-0.5405 (1.8499-1.8698)

AUD/USD Transfer:

The Australian Dollar (AUD) 3-week bull run against the US Dollar (USD) took a breather Monday dropping back to 0.6840 from the recent high at 0.6898 as risk sentiment and US equity markets softened. US Holiday Monday meant markets were thinned out, however we did get some rhetoric from the Fed suggesting they are still hawkish taking up the need for more hikes to come. The next meet-July 27th should represent further tightening. Setbacks towards support at 0.6800 should be well supported for the meantime. With odds better than 50/50 of a hike at the RBA”s next meeting July 4th we see upside on the radar.

Current Level: 0.6851
Resistance: 0.6890
Support: 0.6770
Last Weeks Range: 0.6727-0.6899

NZD/EUR Transfer:

Losses for the New Zealand Dollar (NZD) continued into Monday against the Euro (EUR) to 0.5675 (1.7620) with their kiwi underperforming of late in the aftermath of a dovish RBNZ. The Euro has also been in the same boat with ECB’s Villeroy suggesting inflation had peaked and interest rates are close to topping out. On the docket this week is German and French manufacturing with poor results for May predicted. This could undermine recent Euro strength.

Current Level: 0.5675 (1.7621)
Resistance: 0.5820 (1.7760)
Support: 0.5630 (1.7180)
Last Weeks Range: 0.5669-0.5749 (1.7392-1.7638)

NZD/GBP Transfer:

The New Zealand Dollar (NZD) continues to slide in the wake of the recent recession news. The British Pound (GBP) has looked solid of late gaining on the kiwi to 0.4835 (2.0680) into Tuesday. The GBP boosted recently from the hawkish Bank of England (BoE) rate hike expectations and employment data. The backing off of US equities has also influenced the NZD with risk sentiment not as positive as we saw last week. The 0.4820 (2.0740) low from April 2020 is looking close with predictions it could test this in the coming days. The Bank of England official cash rate releases Thursday with a hike to 4.75% looking likely.

Current Level: 0.5675 (1.7621)
Resistance: 0.4915 (2.0740)
Support: 0.4821 (2.0340)
Last Weeks Range: 0.4845-0.4915 (2.0342-2.0639)

NZD/AUD Transfer:

With Australian Jobs data printing better than expected last week we see the chances of the RBA hiking at the July meeting better than 50/50 chance. This has put the Australian Dollar (AUD) back in the driver’s seat over the New Zealand Dollar (NZD) as it’s well supported on any dips. The cross reaching 0.9050 (1.1050) as I write and approaching the yearly low at 0.9020 (1.1090). All the momentum is with the AUD with predictions the RBA may hike at their next meeting in July and the RBNZ saying recently they were done with tightening policy. Through 0.9000 (1.1111) and this sends a strong signal we could see it drift further well into the 80’s. Clients needing to buy AUD should consider at current prices.

Current Level: 0.9047 (1.1043)
Resistance: 0.9160 (1.1090)
Support: 0.9015 (1.0920)
Last Weeks Range: 0.9049-0.9149 (1.0929-1.1050)