• European Central Bank leave rates on hold at 2.15%. Lagarde waits for further clarity over tariff effects.
• US CPI rises to 2.9% y/y after a print of 2.9% was predicted. The Fed are now expected to cut rates this week on Thursday morning 25 points to 4.25% amid a cooling labour market and rising inflation.
• The Australian Dollar (AUD) is getting a boost higher early in the week based on the odds of waning rate cut odds at the late September RBA meeting.
• President Trump says he is ready to impose sanctions of Russia as NATO countries pause their purchases on oil from Russia.
• DOW reaches an all-time high Monday of 45,188
• The Australian Dollar (AUD) has been the strongest currency this far in September while the Canadian Dollar (CAD) has been the worst performer on the main board.
The long-term trend in the New Zealand Dollar (NZD), US Dollar (USD) is still firmly to the downside with a lingering “double” RBNZ rate cuts on the radar, however the kiwi is enjoying a flurry of bid action of late climbing Monday to 0.5975 as chances of fed cuts loom large. A break above 0.6000 would be significant as we have not seen this level since late July. We have NZ GDP data printing later in the week which should show poor second quarter growth of -0.3% in the country. First quarter growth came in at 0.8% as a comparison. The US Federal Reserve is predicted to cut the cash rate to 4.25% Thursday morning from 4.5% and resume their cutting cycle well into year end.
Current Level: 0.5967
Support: 0.5850
Resistance: 0.6050
Last week's range: 0.5875 - 0.5980
The New Zealand Dollar (NZD) has slumped to 0.5880 against the US Dollar (USD) Friday as the New Zealand economy shrinks more than expected in the second quarter ending June. Data released yesterday showed the countries GDP declined by 0.9% compared to -0.3% expected. The downbeat report could reinforce the RBNZ stance that the central bank may need to cut the cash rate by a further 25 points twice more this year. This alone could create upside headwinds for the kiwi through to the end of the year and beyond. The Fed however may offer some relief when they also cut by a further 50 points in 2025. ONnthe chart we are watching the 0.5800 support level, as rhetoric builds for the fed to cut more aggressively we should see this level avoided.
The current interbank midrate is: NZDUSD 0.5882
The interbank range this week has been: NZDUSD 0.5871- 0.6007
The New Zealand Dollar (NZD), Australian Dollar (AUD) cross has closed (daily) at 0.8950 (1.1170) this morning marking the lowest (daily) close since October 2022. As we have been saying for a while we always expected price to drift deep into the 80’s, here we come. Currently the pair trades circa 0.8950 (1.1170). We have had very little data to work with in the past month or so with moves mostly shifting off central bank rhetoric. Eyes are on NZ GDP q/q printing Thursday and should reflect a -0.3% change from first quarter’s 0.8% which could weaken the NZD. Aussie unemployment also releases and should remain at 4.2%. Buyers of AUD may want to look at doing something now with further drops predicted.
Current Level: 0.8941
Support: 0.8810
Resistance: 0.8970
Last week's range: 0.8955 - 0.9030
Another fresh daily close below 0.8900 in the New Zealand Dollar (NZD), Australian Dollar (AUD) cross posting 0.8895 this morning is an October 2022 low. The next key level is 0.8750 (1.1430) with thin air in between. NZ GDP Q2 data depreciated the NZD when it printed at -0.9% instead of the -0.3% expected. The NZ economy contracting more than predicted- 3 of the last 5 quarters, has fuelled bets the RBNZ may cut twice more this year to 2.5% and again early in 2026 with the cash rate bottoming out at 2.25%. Next weeks Australian CPI y/y should give us more directional ques.
The current interbank midrate is: NZDAUD 0.8892 AUDNZD 1.1235
The interbank range this week has been: NZDAUD 0.8866- 0.8984 AUDNZD 1.1130- 1.1278
Current Level: 1.1176
Support: 0.1.1150
Resistance: 1.1350
Last week's range: 1.1076 - 1.1168
The New Zealand Dollar (NZD) has outperformed the British Pound (GBP) over the past 3 weeks, this week looks no exception with prices eying the upside. We are seeing a little resistance around the 0.4405 (2.2700) zone but if the cross can break through this key level we could see bullish continuation. This week’s data with NZ GDP, Q2 and the official Bank of England Cash rate may have other ideas of a NZD move higher. The BoE will retain rates at 4.00% most likely strengthening the Pound while a poor read in NZ GDP q/q predicted may assist to sink the kiwi.
Current Level: 0.4386
Support: 0.4365
Resistance: 0.4405
Last week's range: 0.4362- 0.4408
Current Level: 2.2799
Support: 2.2700
Resistance: 2.2900
Last week's range: 2.2685 - 2.2922
The European Central Bank maintained its key interest rate, keeping the deposit rate at 2.15% late last week, the bank keeping a cautious approach as inflation remains stable and the Eurozone economy shows resilience. Prices may struggle this week to gain momentum past 0.5100 (1.9600) currently 0.5075 (1.9700) with the ECB strategy not having any upcoming rate cuts on the schedule.
Current Level: 0.5073
Support: 0.5015
Resistance: 0.5100
Last week's range: 0.5025- 0.5097
Current Level: 1.9712
Support: 1.9620
Resistance: 1.9950
Last week's range: 1.9618 - 1.9899
The Australian Dollar (AUD) has extended gains Monday off 0.6630 levels rising against the US Dollar (USD) to 0.6670 in early morning trade. The bullish channel from early April firmly intact with the Aussie now targeting resistance at 0.6800. The Federal Reserve will cut interest rates this week from 4.5% to 4.25% and are expected to suggest in their report further cuts will be made at the October and December. Comparatively with the RBA we have seen stable inflation and household spending rises signalling a consumer recovery of sorts thus reducing consensus of a RBA cut.
Current Level: 0.6672
Support: 0.6600
Resistance: 0.6780
Last week's range: 0.6548 - 0.6668
The Australian Dollar (AUD) reached the 0.6700 level midweek an 11-month high against the US Dollar (USD) before relenting to poor Australian jobs data. The Aussie falling hard to 0.6610 into Friday. The US Fed cut their cash rate from 4.5% to 4.25% as widely predicted and signalled the central bank may need to implement two more cuts in 2025 to allow for falling employment numbers. If jobs data improves in October and November this could take the December cut off the table. Support at 0.6600 may hold into the weekend close.
The current interbank midrate is: AUDUSD 0.6614
The interbank range this week has been: AUDUSD 0.6605- 0.6706
The Australian Dollar (AUD) holds the upper hand against the British Pound (GBP) extending Fridays moves into Monday to 0.4906 (2.0380). A new daily close above key multi month resistance at 0.4900 (2.0400) from mid-March 2025. The Bank of England (BoE) are expected to maintain their bank rate at 4.00% this week with the outcome mostly baked into current price, however the vote could be split. Rhetoric suggests a November rate cut has also fades the battle of which central bank will cut first mounts. Certainly, price momentum suggests a retest of the long-term level around 0.5000 (2.000) could be on the cards.
Current Level: 0.4902
Support: 0.4760
Resistance: 0.4920
Last week's range: 0.4853 - 0.4916
Current Level: 2.0399
Support: 2.0320
Resistance: 2.1000
Last week's range: 2.0339 - 2.0602
The Australian Dollar (AUD) continues to make gains on the Euro (EUR) heading into the week coming off the 0.5660 (1.7660) to enter Tuesday around 0.5670 (1.7630) levels. This marks 4 weeks of the AUD outperforming the Euro as investors try and decipher upcoming central bank intentions. ECB’s Nagel warned that future rate cuts could jeopardise the 2.0% inflation target. Australian unemployment Thursday is expected to print unchanged at 4.2%.
Current Level: 0.5671
Support: 0.5550
Resistance: 0.5715
Last week's range: 0.5592 - 0.5684
Current Level: 1.7633
Support: 1.7500
Resistance: 1.8030
Last week's range: 1.7591 - 1.7882
