AUD/GBP Transfer:

The British Pound (GBP), Australian Dollar (AUD) looks to be consolidating around the 0.5250 (1.9050) area into Tuesday after a decent move from 0.5375 (1.8600) last week. Sitting close to the long-term low at 0.5200 (1.9225) we believe further GBP flow should push the pair through this level in the coming hours/days for the first time since the Brexit vote in 2016. The key release of the week is Aussie CPI y/y which has potential to tick higher than the current 6.8% and question recent RBA narrative.

Current Level: 0.5253 (1.9036)
Resistance: 0.5350 (1.9180)
Support: 0.5215 (1.8700)
Last Weeks Range: 0.5237-0.5380 (1.8586-1.9094)

AUD/USD Transfer:

The Australian Dollar (AUD), USD Dollar (USD) cross has consolidated around 0.6670 levels into Tuesday after large moves last week from 0.6870. The Aussie being hit from lower metal prices, poor sentiment in China and growth prospects. Growth has been revised lower and is expected to slow heading into the 4th quarter dragged lower by weakness in consumption and the chances of the economy falling into a recession, This week’s inflation report should give us clues as to price pressures and how the RBA could react. We expect the central bank to hike in July, but the decision isn’t a given. The key fibonacci level at 0.6670 may lend support to AUD upside.

Current Level: 0.6678
Resistance: 0.6800
Support: 0.6570
Last Weeks Range: 0.6661-0.6882

NZD/EUR Transfer:

The New Zealand Dollar (NZD) has been the standout performer over the past few days of trading but no match for the Euro pushing the kiwi to a 3-week low to 0.5615 (1.7810) at week’s end. The Euro remains well supported despite a slew of awful data publishing. French and German manufacturing came in light and German PMI was disappointing, the figure at 88.5 falling to a post covid low. ECB’s Lagarde is speaking at a number of engagements over the week we also have German, Spanish and Italian CPI prints. The EUR is supported by the 50-day moving average with moves likely towards 0.5550 (1.8000).

Current Level: 0.5647 (1.7708)
Resistance: 0.5730 (1.8060)
Support: 0.5540 (1.7450)
Last Weeks Range: 0.5614-0.5707 (1.7522-1.7810)

NZD/GBP Transfer:

The New Zealand Dollar (NZD) is a little stronger off the weekly open against the British Pound (GBP) reaching 0.4860 (2.0570) into Tuesday trading. Generally speaking, a lack of data sees the pair happy to bounce around in recent ranges. Better than expected UK Retail Sales Friday boosted the GBP coming in at 0.3% compared to -0.2% predicted. We still see decent flows in the GBP from last week’s Bank of England hike to 5.00% continuing. The Key standout on the docket this week is the RBNZ “Statement of Intent” Friday. We see a retest of the recent low at 0.4830 (2.0700) a chance this week.

Current Level: 0.4847 (2.0631)
Resistance: 0.4910 (2.0800)
Support: 0.4810 (2.0380)
Last Weeks Range: 0.4808-0.4879 (2.0496-2.0797)

NZD/AUD Transfer:

Surprisingly the Australian Dollar (AUD) continues to give back gains early this week extending moves to 0.9250 (1.0815) where it looks to have settled. Sliding commodities and the latest global sentiment read has benefited the AUD more favourably. If the RBA hikes next week this could change things up. Focus this week will be on Australian CPI data, moves over the week could well be dictated by this pending print. A release higher from the current 6.8% y/y will no doubt deflect more investors away from the NZD.

Current Level: 0.9224 (1.0830)
Resistance: 0.9440 (1.1020)
Support: 0.9075 (1.0590)
Last Weeks Range: 0.9048-0.9207 (1.0861-1.1051)

NZD/USD Transfer

The New Zealand Dollar (NZD) recovered losses against the US Dollar (USD) as the week got underway back to 0.6170 from 0.6115- greenback weakness evident. Waning commodity prices, poor Chinese industrial data and global sentiment may continue to weigh down the currency. We see a strong probability the Federal Reserve will hike again at the late July meeting despite reasonable chances the economy could drop into recession. The Fed still adamant they need the inflation target at 2.0%. Our technical chart indicators suggest the kiwi bias is to the downside for the next while.

Current Level: 0.6163
Resistance: 0.6300
Support: 0.6040
Last Weeks Range: 0.6115-0.6236

Calendar of Economic Releases

Wednesday June 28
12:30am CAD CPI m/m
Forecast 0.50%
Previous 0.70%
12:30am CAD Median CPI y/y
Forecast 4.00%
Previous 4.20%
12:30am CAD Trimmed CPI y/y
Forecast 4.00%
Previous 4.20%
2:00am USD CB Consumer Confidence
Forecast 104
Previous 102.3
1:30pm AUD CPI y/y
Previous 6.80% Read more

Key Points This Week:

Key Points:

NZ May credit card spending +3.3% compared with expectations of +13.9%, recession taking a hold.
Chinese Lifong was out on the wires yesterday talking up the Chinese economy- “the economy has recovered and turned for the better” – hmmm.
Yellen has said the chances of a Eurozone recession has eased but risk remain.
The Bank of England hikes interest rates 50 points to 5.00% with predictions of two more to come.
Japan’s economy is recovering at a moderate pace with employment improving and business activity on the rise.
The Euro (EUR) has been the strongest performer this week with the Australian Dollar (AUD) the worst performer.

NZD/GBP Transfer:

The English Pound (GBP) climbed to 2.0630 this morning against the New Zealand Dollar (NZD) after the Bank of England hiked their base interest rate 50 points to 5.00% in a surprise move after markets were mostly expecting a rise to 4.75%. The central bank is more aggressive as efforts ramp up to curb massive inflation issues. This is the highest interest rate since 2008 with thoughts around the BoE now facing prospects of having to nudge the economy into recession later in the year to contain rising prices. Earlier UK inflation came in hot at 8.7% year on year after 8.4% was predicted, an unchanged shock result. This is clearly not the number the Bank of England were hoping for, the result beating out lower expectations the 4th month in a row. Further rises by the central bank- perhaps 2 more in August/September are now more than likely. A retest of the low at 0.4820 (2.0750) looks the most likely scenario in the coming hours/days, a push through here and the next target is 0.4670 (2.14) the low of March 2020 and the infamous day of the Brexit vote in June 2016.

The current interbank midrate is: NZDGBP 0.4855 GBPNZD 2.0597
The interbank range this week has been: NZDGBP 0.4820- 0.4878 GBPNZD 2.0497- 2.0746