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Market Update 09/05/2024

Equity markets showed a varied performance, while bond yields went up a bit alongside the USD DXY. The yield on the US 10-year rate rose 4bp to 4.49%. There weren’t many economic reports or speeches from central bankers during the day.

The NZDUSD is holding steady at a satisfactory level of 0.6006 cents. In the short term, there seems to be support for NZDUSD around the range of 0.5985, followed by 0.5965. But there is anticipated resistance near 200-day moving average at 0.6040. A push to 0.6015-20 would be challenging without significant movements in USDJPY.

RBA’s less hawkish stance on Tuesday was a letdown for the market, leading NZDAUD stabilizing for the moment and showing indications of moving upwards as we anticipate more data and shifts in the interest rate market. Initially, there could be difficulty breaking through resistance around the 0.9130 level, but it wouldn’t be surprising to see the pair continue to rise if there are no adverse developments affect the NZD.

Despite the efforts by officials at the Bank of Japan (BoJ) and the Ministry of Finance (MoF) to verbally support the JPY, the USDJPY weakened yesterday. The absence of suspected intervention in the currency market this week appears to be boosting confidence among USDJPY buyers. BoJ Governor Ueda expressed worries about the ongoing weakening of the yen, suggesting that it could lead to economic uncertainties and challenges for businesses in Japan. According to Bloomberg news, he indicated that if currency movement starts affecting inflation, it might be appropriate for the central bank to consider intervening in the FX market. Bloomberg reporters observed a shift in the governor’s stance following his meeting with Prime Minister Kishida on Tuesday. USDJPY moves remain in the the focus.

Bank of England (BoE) policy meeting is the key focus for markets, preceding next week’s release of US April inflation data. Market expectations suggest that the BoE will maintain interest rates at their current level of 5.25%.

There is no scheduled data for New Zealand & Australia today. China Trade Balance data expected this afternoon.

Here are the latest mid-market rates:

Currency PairMid-market rate

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