After breaking lower from the 7-week range through 0.9260 (1.0800) the New Zealand Dollar (NZD) has dropped to post 0.9100 (1.0990) over the week against a stronger Australian Dollar (AUD). The NZD falling also as market tone turned risk off. Into Friday the kiwi has recovered slightly to 0.9140 (1.0940) but the Aussie remains in charge. Australian Job numbers came in poor with a sharp decline in June’s newly employed workforce dropping to just 2,000. The unemployment rate also rose to 4.3% after 4.1% was predicted. This raises forecasts of an RBA cut on August 12th with a fresh “easing’ bias on the horizon. Next week’s data comes in the form of NZ CPI q/q with a rise expected.
UK CPI y/y printed up on expectations of 3.4% coming in at 3.6% sending the British Pound (GBP) higher against the New Zealand Dollar (NZD). That with a bout of “risk off” mood sent the kiwi off 0.4460 (2.2420) to 0.4410 (2.2670) over the week. Overnight equity gains gave the NZD a look at 0.4425 (2.2600) into mid Friday. Meanwhile the UK labour market added 29k of job seekers in June with unemployment rising to 4.7% from the previous 4.6%. Next week’s docket sees NZ CPI q/q printing with a sharp rise expected.
The Australian Dollar (AUD) gave back last week’s gains over the week returning from 0.4880 (2.0500)- the late March high, to post 0.4820 (2.0740) into Thursday. UK CPI y/y printed up on 3.4% expectations at 3.6% rallying the GBP in line with a “risk off” mood. Aussie unemployment rose to 4.3% raising bets the RBA should cut interest rates next month. The AUD/GBP has had multiple retests this year off 0.4885 (2.0470) signalling we could see further momentum over the next while towards 0.4760 (2.1000)
A bumper US CPI release Wednesday weakened the New Zealand Dollar (NZD) from the 0.6000 mark to 0.5940 levels. CPI y/y printed at 2.7% up from the 2.6% markets were expecting. The Fed will almost certainly leave interest rates unchanged at their July 31 meeting possibly through to September. This should in theory keep the lid on any big moves higher in the NZD/USD with attractiveness in the greenback forefront.
The Australian Dollar (AUD) has reversed off the weekly open at 0.6590 giving back last week’s gains to 0.6490 into Friday trading. A little swing higher during overnights surge in equity markets helped boost buyer sentiment off 0.0.6455 but this may be a temporary move as a big picture downtrend starts to come into play. US CPI printed at 2.7% vs 2.6% expected not helping the AUD with expectations the Fed will keep the interest rate unchanged at 4.5% at next week’s meeting. Longer term Tariff uncertainty will play a part but for now keeping inflation higher than it should be and forcing further central bank divergence. Support seen at the 0.6420 level.
Post Tags: #AUD/GBP#AUD/USD#currency market#currency trends#exchange rates#FX market insights#FX Weekly Update#NZD/AUD#NZD/GBP#NZD/USD
