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On Friday night, equity markets bounced back after a series of weak sessions. The S&P 500 rose by 1.1%, the Dow increased by 1.6%, and the Nasdaq went up by 1.0%. Meanwhile, the yield on the US 10-year bond dropped by 4.7 bps to 4.19%.
In June, headline PCE inflation increased to 0.1% month-over-month, up from a slightly revised 0% in May. The Fed’s preferred inflation measure, the core PCE deflator, rose to 0.18% m/m. The May and April figures were revised up to 0.13% and 0.261%, respectively. This leaves the annual core PCE inflation rate at 2.6%.
Early reports indicate that Israeli aircraft attacked Hezbollah in Lebanon in response to a rocket strike on a soccer field, which Israel claims was fired by the group, killing 12 people, including children. Diplomatic efforts are urgently underway to prevent the situation from escalating into a regional war.
After a week of significant fluctuations in currency markets, the USD remained stable at the close, with G10 currencies staying within narrow ranges.
NZDUSD couldn’t climb back to 0.59 before the New York close, but it showed signs of stabilizing and didn’t fall below Friday’s local lows in late trading. Support is at 0.5890, with resistance at 0.5960 and 0.6000.
NZDAUD stayed within its very short-term range, with support at 0.8950 and resistance at 0.9035. With a lack of major data this week, the focus now shifts to the Q2 CPI report on Wednesday at 1:30pm.
NZDEUR is currently trading at 0.5423, making it hard to be positive about this currency pair. Support levels are at 0.5420 and 0.5370, with resistance at 0.5490 and 0.5525.
It’s a big week for central banks with the BoJ, Fed, and BoE in the spotlight. The BoE is expected to cut rates, the Fed is likely to signal rate cuts, and the BoJ is uncertain, with a 50/50 chance of either cutting bond purchases or hiking rates. This will make for an interesting week for central bank watchers. Additionally, Australian CPI data will be important on Wednesday afternoon at 1:30 pm; if it’s strong, the market might anticipate a rate hike as early as next week.
Here are the latest mid-market rates:
| Currency Pair | Mid-market rate |
| NZD/USD | 0.5890 |
| NZD/AUD | 0.8992 |
| NZD/JPY | 90.59 |
| NZD/CNY | 4.2720 |
| NZD/EUR | 0.5427 |
| NZD/GBP | 0.4578 |
| NZD/HKD | 4.5912 |
| NZD/SGD | 0.7896 |
NZD/USD 24 HOURS
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