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AUD / USD
The Australian Dollar opened weaker this morning when valued against the Greenback on the back of escalating tensions between North Korea and the United States. Yesterday we saw the Aussie dollar confined to a limited range of roughly 30 pips. The Australian macroeconomic calendar has a quiet week ahead, there are no scheduled data releases for today, the Aussie dollar will continue to be driven by investor sentiment. The AUD/USD pair reached an overnight low of 0.7926, currently trading at 0.7929. We now expect support to hold on moves approaching 0.7910 while any upward push will likely meet resistance around 0.7990.
Great British Pound
GBP / AUD
1.6820 – 1.7150
USD, EUR, JPY
New Zealand Dollar
NZD / USD
0.7130 – 0.7350
Having edged higher on open the Kiwi gave up early gains on Monday shifting back below 0.73 U.S cents as investors digested recent moves and Saturday' election result. With a coalition needed for the Nationals or Labour to form government investors looked to take profit and sold down NZD holdings. The New Zealand dollar has been one of the best performing major units through the last month and markets seemed content capitalising on gains ahead of further political uncertainty. Having touched intraday lows at 0.7248 the Kiwi opens this morning buying 0.7250 U.S Cents as attentions turn to Thursday RBNZ rate statement and policy announcement for direction moving forward.
0.7850 – 0.8075
The Australian Dollar opened weaker this morning when valued against the Greenback. After losing nearly 100 pips on Thursday the AUD/USD pair was able to stage a modest recovery on Friday but failed to extend its gains above the 0.80 mark. The Aussie closed the week lower at around 0.7960 down for a second consecutive week. In the absence of any market-moving economic data this week the Aussie dollar is likely to be driven by investor sentiment. The AUD/USD pair is currently trading at 0.7952. We now expect support to hold on moves approaching 0.7910 while any upward push will likely meet resistance around 0.7990.
1.6800 – 1.7150
0.7220 – 0.7440
The New Zealand Dollar enjoyed mixed fortunes through trade on Friday edging lower throughout the domestic session as uncertainty surrounding the weekends election led to short term profit taking and repositioning. Touching intraday lows at 0.7275 the NZD then rallied into the close, buoyed by risk off trade and wider USD weakness following a dismantling of risk appetite in the wake of comments from North Korea' foreign minister. Escalating tensions between the rogue State and the US forced a selloff in U.S yields and the worlds base currency enabling the NZD to move back through 0.73 and touch 0.7345. As attentions turn now to the election result there is some scope for an uptick with the prospect of looser fiscal policy and increased government spending likely to drive inflation and force RBNZ activity sooner than expected.
0.7870 – 0.8050
It' been a wild ride for the AUD over the past 24 hours gyrating between a low of 0.7916 and a high of 0.8036 when valued against its US Counterpart. Amid highly liquid trading conditions the Australian dollar managed to give up all of its gains from overnight on Wednesday in the aftermath of comments made by RBA Governor Philip Lowe. Triggering the sell-off Phillip Lowe stated that markets couldn’t rely on accommodative monetary policy forever and that the environment of record low interest rates was nearing an end. Opening a staggering 1.2% lower the Australian dollar currently swaps hands a rate of 0.7932 when valued against its US Counterpart.
1.6980 – 1.7250
The New Zealand dollar has continued to fade from a position of strength over the past 24 hours, slumping to an eventual low of 0.7298 when valued against its US Counterpart. Whilst recent polling has re-affirmed the National Party' lead ahead of tomorrow' vote, currency moves were more influenced by the FOMC for much of Thursday' session as the Kiwi struggled to keep pace with the world' reserve currency. Whilst monetary and balance sheet tightening from the United States remains a critical driver over the medium-term, this weekend' election will have the markets full attention. Opening lower the New Zealand dollar currently buys 73.07 US Cents.
0.7980 – 0.8080
The Australian Dollar ascended against the Greenback yesterday as government yields hit their highest level since 2015 which gave support to the local unit. Pre FOMC announcement, AUD/USD hit a high of 0.8100 but soon pulled back falling almost a cent back under 0.8000 following the Fed release. As widely expected the Fed held the target rate steady at 1.00-1.25% and also announced the beginning of balance sheet normalisation next month after almost ten years of the onset of the global financial crisis. Markets are led to believe there will be three rate hikes in 2018 and perhaps one in December of this year. Aussie currently buying 0.8030 when valued against its US counterpart. Later today sees the RBA Governor Lowe speak in Perth on a speech titled ‘The Next Chapter’ to the American Chamber of Commerce.
1.6625 – 1.6925
0.7275 – 0.7425
The New Zealand Dollar is slightly stronger against the Greenback after the Federal Reserve on Wednesday said it would embark next month on its biggest policy shift since 2015. The central bank confirmed that it would start trimming the $US4.5 trillion balance sheet it built up. On the release of the FOMC statement the Kiwi spiked to a six week high of 0.7433. Looking ahead locally today and all attentions turn to the release of Gross Domestic Product for the second quarter which is expected to rise 0.8%, taking the year on year pace to 2.5%. The NZD/USD pair is currently trading at 0.7352. We now expect support to hold on moves approaching 0.7340 while any upward push will likely meet resistance around 0.7400.
0.7880 – 0.8090
The Australian Dollar has climbed back through Tuesdays day of trading against the Greenback buying above the 80c handle, overnight it touched a high of 0.8020. The minutes from the latest Reserve Bank policy meeting showed that the bank is more positive about the domestic outlook and are upbeat on the labour market. Despite this the notes of caution still remain with the RBA and they are unlikely to look at raining rates anytime soon. In other news, House Price Index came in at 1.9% in the June quarter vs an expected 1.2% gain which was the likely driver behind the Aussie push towards 80c. RBA assistant governor is due to speak today at a the Australian Business Economists Lunchtime Briefing in Sydney but markets will be keenly attuned to the Fed which is due to announce plans to begin unwinding it' $4.5 trillion balance sheet.
1.6650 – 1.7050
0.7190 – 0.7390
The New Zealand dollar is stronger this morning when valued against the Greenback. The Kiwi reached an overnight high of 0.7326. Over the last few weeks the NZD/USD currency pair has ranged between 0.7200 and 0.7350, capped by election uncertainty, and by the downward trend in the Greenback. Looking ahead this week and traders are now preparing for the release of the quarterly GDP report on Thursday and the country's general election on Saturday. The NZD/USD pair is currently trading at 0.7314. We now expect support to hold on moves approaching 0.7240 while any upward push will likely meet resistance around 0.7329.
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