• Traffic through the Strait of Hormuz is still very limited with the Crude Oil chokepoint still mostly closed. The ceasefire with Iran in place is at threat as President Trump announced plans to guide ships through the strait.
• The International Monetary Fund (IMF) has updated their earlier global warning of slower global growth to an actual forecast. If the wars extends into 2027 and oil prices stay elevated this will significantly worsen the global economic outcome
• The RBA raises interest rates late yesterday from 4.10% to 4.35%.
• Crude Oil sits around 102.00 per barrel this morning down 3.00 on the day.
• US GDP growth estimate revised up from 3.5% to 3.7% in the second quarter.
• The Australian Dollar (AUD) has been the strongest performer this week while the British Pound (GBP) the worst performer.
The New Zealand Dollar (NZD) followed the Aussie higher off the back of an RBA hike, coming off the weekly low of 0.5856 to trade back around 0.5890 this morning. Also helping was a fresh bout of “risk on” with the US Dollar (USD) falling in demand agst the G10 currencies. This week we have NZ employment data publishing with expectations of a fall to 5.3% to the number seeking work and US Non-Farm Payroll also expected to print well down on previous months. Dips seem to be well supported for the meantime in the cross, a daily close above 0.5910 could signal further upside.
Current Level: 0.5902
Support: 0.5930
Resistance: 0.5850
Last week's range: 0.5814- 0.5924
The New Zealand Dollar (NZD) broke out of the long-term bear structure Yesterday clawing back last week’s losses against the Australian Dollar (AUD) to 0.8225 (1.2160). The RBA hiked interest rates as expected from 4.10% to 4.35% strengthening the kiwi momentarily before the long-term bear trend resumed. In late NY session trade, we see the pair back towards 0.8190 (1.2210) the Aussie taking back control.
Current Level: 0.8189
Support: 0.8175
Resistance: 0.8245
Last week's range: 0.8174-0.8233
Current Level: (1.2200)
Support: (1.2130)
Resistance: (1.2230)
Last week's range: (1.2145-1.2233)
Today’s NZ unemployment came in at 5.3% ending March slightly lower than the 5.4% we were expecting sending the New Zealand Dollar (NZD) higher to 0.8200 (1.2200). Last week the Bank of England (BoE) left their cash rate unchanged at 3.75% in a 1-8 result by the voting members, the central bank hinting at further rises to come in direct response to the Iran war. Pressures remain to the downside for the kiwi with bear continuation predicted and a possible retest of the area around 0.4315 (2.3170)
Current Level: 0.4349
Support: 0.4330
Resistance: 0.4365
Last week's range: 0.4320-0.4371
Current Level: (2.2993)
Support: (2.900)
Resistance: (2.3100)
Last week's range: (2.2877-2.3145)
The New Zealand Dollar (NZD), Euro (EUR) cross pivots around the 0.5005 (1.9880) zone in early morning trade just off the key Fibonacci key 0.5025 (1.9900) level as we await direction clues. It’s a fairly light week on the economic docket with Lagarde speaking towards the end of the week and French holiday Friday. With the ECB acknowledging a worsening economic backdrop in geopolitical dynamics in Iran it’s a battle to the bottom for the cross.
Current Level: 0.5037
Support: 0.5000
Resistance: 0.5050
Last week's range: 0.4987-0.5048
Current Level:(1.9853)
Support: (1.9800)
Resistance:(2.000)
Last week's range: (1.9809-2.0050)
The Australian Dollar (AUD) came under a little pressure post the RBA decision, not rallying like we expected against the US Dollar (USD) despite the central bank delivering the expected hike from 4.10% to 4.35%. A less hawkish tone is how markets interpreted the feel but reinforcing inflation remains a problem. Policy changing to a clear “lets wait and see” approach with regards to how the conflict in Iran and Crude Oil prices evolves with lingering concerns of growth and uncertainty remain. Bullish momentum may come down to Fed policy in the short to medium term. A daily close above the key 0.7200 level should confirm further topside moves.
Current Level: 0.7203
Support: 0.7100
Resistance: 0.7220
Last week's range: 0.7100- 0.7207
The Australian Dollar (AUD) bounced off the 4-week low at 0.5280 (1.8950) against the British Pound (GBP) yesterday extending back towards the long term high around 0.5310 (1.8840). The RBA less hawkish hike from 4.10% to 4.35% saw a modest rise from the Aussie but not as we expected. RBA’s Bullock, saying she hoped the rise in rates would assist in holding down rising inflation in a forever changing outlook. The governor also saying policy is now a touch restrictive which will buy them time to assess how the economy progresses. A close above 0.5340 (1.8740) and its thin air to 0.5360 (1.8650) the Dec 2023 high.
Current Level: 0.53066
Support: 0.5230
Resistance: 0.5340
Last week's range: 0.5275-0.5320
Current Level: (1.8846)
Support: (1.8740)
Resistance: (1.9130)
Last week's range: (1.8796-1.8955)
The Euro (EUR) has been trading with a softer bias of late given struggles in the Strait of Hormuz has lifted Oil linked higher inflation expectations in the region. The Australian Dollar (AUD) – the opposite can be said, although yesterday’s RBA hike was a touch less hawkish than markets were predicting. The RBA raised rates to 4.35% off 4.10% with Governor Bullock saying a restrictive approach is needed for now as they “wait and see” how the geopolitical backdrop unfolds. The cross trades at 0.6150 (1.6270) this morning higher off the weekly open and looks to make a play for the 0.6240 (1.6020) high of November 2024.
Current Level: 0.6144
Support: 0.6090
Resistance: 0.6190
Last week's range: 0.6089-0.6148
Current Level: (1.6276)
Support: (1.6165)
Resistance: (1.6420)
Last week's range: (1.6265-1.6423)
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