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Equities had a mixed performance as financial markets began to stabilize after last week’s volatility. The S&P 500 remained steady, while the Nasdaq Composite managed a slight gain of 0.2%. In Europe, the Euro Stoxx 50 dipped by 0.1%, but the FTSE 100 rose by 0.5%. Meanwhile, the yield on the US 10-year note fell by 3.2 bps to 3.91%. After a week of turbulent trading, markets are now showing some resilience, and cautiously awaiting key US inflation data, which is expected in the early hours of Thursday (NZT).
The US NY Fed’s survey showed a slight decrease in consumer expectations for inflation over the next year, down to 2.97% in July from 3.02% in June. Expectations for the next three years dropped by 0.66% to a record low of 2.3%. In July, more households reported finding it harder to access credit compared to a year ago.
NZDUSD has performed well, rising 0.3% to 0.6020, and strengthening against all major currencies ahead of Wednesday’s OCR announcement. If the RBNZ doesn’t cut rates or issues a statement that aligns with current expectations, the NZD could find support due to its yield advantage. However, US inflation data is expected to show a modest increase, could strengthen the USD, potentially reversing any gains in the NZD after the RBNZ announcement. Currently, 0.6000 is acting as support, with resistance before the RBNZ decision around the 100-day moving average at 0.6040. Beyond that, resistance becomes more complex near 0.6100, with levels at 0.6060 (50-day MA), 0.6075 (Fibonacci level), and 0.6085 (200-day MA).
NZDAUD has risen to 0.9140. Today might be relatively quiet, but if anything stirs the market, it will probably be related to the AUD, with key data on wages, and consumer & business confidence expected. Since RBA expectations have been a significant factor in NZDAUD volatility, these reports will be closely monitored.
NZDJPY has increased by 0.73% to 88.60, while the Yen has declined by 0.5%.
NZDGBP and NZDEUR are both performing well, rising by 0.2-0.3% to 0.4715 and 0.5507, respectively.
Locally on the economic calendar, we’ll start with the ANZ Truckometer at 10:00 AM and NZ Visitor Arrivals at 10:45 AM. Following that, we have three important Australian economic updates: Westpac Consumer Sentiment at 12:30 PM, and both the Wage Price Index and NAB Business Confidence at 1:30 PM. Our Australian economic team expects the Wage Price Index to rise by 0.9% quarter-on-quarter for Q2, due to seasonal factors, but to slightly decline year-on-year to 4.0% from 4.1%.
In the evening, we’ll see UK labor market numbers before US PPI is released in the early hours. FOMC Member Bostic will also speak just before our day begins
Here are the latest mid-market rates:
| Currency Pair | Mid-market rate |
| NZD/USD | 0.6018 |
| NZD/AUD | 0.9138 |
| NZD/JPY | 88.59 |
| NZD/CNY | 4.3204 |
| NZD/EUR | 0.5507 |
| NZD/GBP | 0.4715 |
| NZD/HKD | 4.6890 |
| NZD/SGD | 0.7971 |
NZD/USD 24 HOURS
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