BR100 Increased By (0.01%)
BR30 Increased By (0.53%)
KSE100 Increased By (0.28%)
KSE30 Increased By (0.29%)
AGHA 6.35 Increased By ▲ 0.03 (0.47%)
BECO 4.39 Increased By ▲ 0.12 (2.81%)
BML 62.50 Increased By ▲ 0.05 (0.08%)
BOP 31.47 Increased By ▲ 0.24 (0.77%)
CNERGY 11.70 Increased By ▲ 0.11 (0.95%)
CSIL 5.92 Increased By ▲ 0.20 (3.5%)
FCCL 61.60 Increased By ▲ 0.06 (0.1%)
FFL 14.79 Decreased By ▼ -0.23 (-1.53%)
FNEL 1.23 No Change ▼ 0.00 (0%)
KEL 6.33 Increased By ▲ 0.07 (1.12%)
KOSM 5.90 Increased By ▲ 0.34 (6.12%)
LOTCHEM 24.79 Increased By ▲ 0.11 (0.45%)
MLCF 103.93 Decreased By ▼ -0.15 (-0.14%)
NBP 173.05 Decreased By ▼ -2.23 (-1.27%)
NCPL 51.85 Decreased By ▼ -0.92 (-1.74%)
NPL 54.19 Increased By ▲ 0.07 (0.13%)
OGDC 315.50 Increased By ▲ 2.11 (0.67%)
PACE 9.26 Increased By ▲ 0.06 (0.65%)
PAEL 35.51 Decreased By ▼ -0.29 (-0.81%)
PIBTL 13.65 Increased By ▲ 0.18 (1.34%)
PPL 226.60 Increased By ▲ 4.79 (2.16%)
PRL 80.30 Increased By ▲ 1.22 (1.54%)
PTC 46.89 Increased By ▲ 0.04 (0.09%)
SSGC 23.90 Increased By ▲ 0.03 (0.13%)
TBL 9.30 Decreased By ▼ -0.01 (-0.11%)
TELE 7.65 Increased By ▲ 0.26 (3.52%)
TPL 24.51 Decreased By ▼ -0.60 (-2.39%)
TPLP 13.04 Increased By ▲ 0.53 (4.24%)
TREET 26.05 Decreased By ▼ -0.20 (-0.76%)
TRG 53.38 Decreased By ▼ -0.06 (-0.11%)
Markets

Australia, NZ dollars stem downturn but rate jitters persist

Published Updated
By

SYDNEY: The Australian and New Zealand dollars steadied on Monday, drawing support from major chart levels as a tech-driven rally in share markets lifted sentiment, but rate considerations are set to dominate in a central bank packed week.

The Aussie was hovering at $0.6606, having lost 1.3% last week to as low as $0.6525 as hopes for a US interest rate cut in March faded.

It, however, caught some respite in a tech-driven rally in global stocks on Friday, and the support of the 200-day moving average of $0.6580 should hold for now.

The kiwi dollar was idling at $0.6123, after a sharp drop of 2.0% last week to a one-month trough of $0.6088.

It also has support at the 200-day moving average of $0.6090.

The two currencies remain at the mercy of the shifting global interest rate outlook, with events this week - including policy meetings from Bank of Japan and the European Central Bank and the US PCE inflation data - likely to provide some clarity on the timing of rate cuts around the world.

Persistent worries about China’s economic health also weighed on the Antipodean currencies.

The People’s Bank of China on Monday left its benchmark lending rate unchanged as widely expected, after it dealt a setback to imminent easing hopes last week.

“AUD/USD is likely to follow the USD trend this week in the absence of important economic news from Australia or China,” analysts at Commonwealth Bank of Australia said in a note to clients.

Australia, NZ dollars hold near multi-week lows

“Support for AUD/USD at 0.6480 (23.6% fibbo) could be tested this week.”

They added that two other factors could also weigh on the currency in coming months - declining iron ore prices as Chinese steel makers cut back on production and a more aggressive easing streak from the Reserve Bank of Australia than the market is currently pricing in.

Markets are wagering the RBA will not cut until November this year, with the total easing this year just at a modest 33 basis points.

Across the Tasman sea, traders are bracing for New Zealand fourth-quarter inflation on Wednesday.

Economists expect consumer inflation likely slowed sharply to 0.6% from the previous quarter’s 1.8%, with the annual rate also easing to 4.7%.

Markets imply a 75% chance of a first cut from the Reserve Bank of New Zealand in May and a total of 85 basis points of easing this year.

Comments

Comments are closed for this article.