• The RBA is the first global central bank to raise rates. The RBA shifting off 3.60% to 3.85%. This is the first hike by the RBA since November 2023.
• Gold retreated off 5,600 an ounce collapsing to 4,400 in what was seen as the biggest 2 day sell off in history.
• 4th quarter NZ Unemployment published at 5.4% above the 5.3% expected.
• US Equities climb as silver and gold falls.
• The New Zealand Dollar (NZD) holds above 0.6000 as markets prepare for a massive dump of economic data to end the week.
• The US House votes to end government shutdowns.
• The Bank of Japan looks to be more serious around rate hikes as inflation remains above target, markets pulling forward expectations of moves as soon as April.
• US Fed’s Stephen Miran thinks the Fed should cut rate by 1% over 2026 arguing the Feds policy is to “tight” based on what’s happening on the street.
• The New Zealand Dollar (NZD) has been the strongest currency over the past 24 hours while the US Dollar (USD) is the worst performing on the main board.
Last week’s run up to 0.6080 levels by the New Zealand Dollar (NZD) has held very well against the US Dollar (USD) with prices dipping early week to around the 0.6000 mark but has since pushed higher to 0.6045 in morning trade. The greenback has been noticeably weaker of late- the Dollar Index has dropped below key support levels with the currency losing some of its “safe haven” appeal recently with Gold taking a lot of the flow. Also, of note the Fed will start to ease policy over the course of 2026 underpinning the USD. Buyers of USD should consider levels over 0.6000.
The current interbank midrate is: NZDUSD 0.6043
The interbank range this week has been: NZDUSD 0.5990- 0.6064
A long-term base in the Australian Dollar (AUD), US Dollar (USD) looks to have formed around 0.6130, with prices now just above the 0.7000 mark at 0.7020 this morning we are still looking for a monthly close above 0.7000 to cement the upside bias with setbacks supported above the key level of 0.6700 in the meantime. The RBA hiked their cash rate yesterday from 3.6% to 3.85%, which was not entirely factored in rallying the AUD to 0.7050 before settling around 0.7020.
The current interbank midrate is: AUDUSD 0.7017
The interbank range this week has been: AUDUSD 0.6907- 0.7048
The New Zealand Dollar (NZD) has outperformed the British Pound (GBP) of late reaching 0.4425 (2.2600) this morning on broad risk appetite marking the highest level since August last year. NZ unemployment rose this morning from 5.3% to 5.4% but the change in the number of employed people rose 0.5%, the data weakened the kiwi to 0.4410 (2.2670). The Bank of England (BoE) is likely to hold rates Friday morning at 3.75% but may hint at rate cuts sooner rather than later. On the chart we see a break higher outside the long-term channel from Dec 2023 signalling further upside is possible in the NZD.
The current interbank midrate is: NZDGBP 0.4411 GBPNZD 2.2670
The interbank range this week has been: NZDGBP 0.4383- 0.4425 GBPNZD 2.2594- 2.2814
The Reserve Bank of Australia (RBA) hiked interest rates yesterday from 3.60% to 3.85% in a move reasonably well received by markets, the central bank saying inflation continues to climb as markets now expect the RBA to deliver further hikes this year. All eyes now are on the Bank of England (BoE) official cash rate Friday morning with expectations of a unanimous hold 3.75%. The bank could hint at further cuts starting April with falling inflation on the schedule.
The current interbank midrate is: AUDGBP 0.5123 GBPAUD 1.9519
The interbank range this week has been: AUDGBP 0.5056- 0.5147 GBPAUD 1.9428- 1.9775
The New Zealand Dollar (NZD) dipped to 0.8590 levels against the Australian Dollar (AUD) post the RBA cash rate release giving back early week gains from 0.8670. Overnight moves have seen the kiwi bounce back to 0.8630 levels. The RBA hiked interest rates yesterday 25 points siting higher than expected inflation a tight labour market and strong consumer spending. The RBA is expected to raise rates again towards the end of the year. Divergence between central banks may continue to drive prices lower in the cross for a while
The current interbank midrate is: NZDAUD 0.8612 AUDNZD 1.1604
The interbank range this week has been: NZDAUD 0.8586- 0.8675 AUDNZD 1.1527- 1.1646
