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Market Update 22/05/2024

Welcome to our daily market update, where we help keep you informed on the latest happenings in the world of FX.
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Markets remained stable as comments from Federal Reserve officials confirmed expectations of rate cuts this year. Equities maintained their gains, the yield on the US 10-year fell by 3bps to 4.41% and the USD strengthened slightly. The next US CPI release is set for 12th June and the PCE data, which is the Fed’s preferred inflation measure, will be released on 28th June.  
NZD is trading just below 0.6100, a slight drop from yesterday and slightly lower compared to most other major currencies. It has struggled to gain momentum after closing above the 1-year moving average of 0.6065 for the first time since March. Currently, the 0.6080-90 range serves as a temporary support level, with a lower support band at 0.6050-60. On the upside, 0.6140-50 is strong resistance, with a more ambitious target at 0.6220. The direction from here will likely depend on the RBNZ today at 2pm, with hawkish tone potentially boosting the NZD initially. It’s also worth watching Governor Orr’s press conference at 3pm.
AUD remained steady at 0.6665, while the NZDAUD has slightly decreased to 0.9145. This movement was mainly influenced by broader weakness in Asian currencies, which was sparked by declines in the Hang Seng index and ongoing concerns about the Chinese property sector.
Currency movements have been minimal, with major currencies we track all fluctuating within plus or minus 0.2% against the USD overnight. EUR, GBP, and JPY have shown very little change.
Later this evening, UK CPI inflation data is expected to reveal a significant decline, primarily due to sharp drop in household energy costs. This is anticipated to bring the annual inflation rate down to just 2.1%. The spotlight will be on whether inflation remains resilient in the services sector.
On the economic data front today, nothing major is scheduled to come out apart from RBNZ cash rate announcement at 2pm then watch for headlines from Governor Orr’s press conference at 3pm and UK inflation data at 6pm.

 Here are the latest mid-market rates:

Currency PairMid-market rate


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