Saturday, July 19, 2025
  • Login
Forbes 40under40
  • Home
  • Technology
  • Innovation
  • Real Estate
  • Leadership
  • Money
  • Lifestyle
No Result
View All Result
  • Home
  • Technology
  • Innovation
  • Real Estate
  • Leadership
  • Money
  • Lifestyle
No Result
View All Result
Forbes 40under40
No Result
View All Result
Home Lifestyle

Australian, New Zealand dollars on defensive, markets run away from rate cuts

by Riah Marton
in Lifestyle
Australian, New Zealand dollars on defensive, markets run away from rate cuts
Share on FacebookShare on Twitter


THE Australian and New Zealand dollars were ending the week on the defensive on Friday as upbeat economic data lifted their US counterpart, while debt markets further lengthened the odds on early rate cuts at home.

The Aussie faded to US$0.6596, having failed to hold a key US$0.6650 chart level. That left it down 1.3 per cent for the week and well away from the recent four-month top of US$0.6714. Support now lies in the US$0.6560/6580 zone.

The kiwi dollar held at US$0.6095, having eased 0.6 per cent for the week and off a two-month high of US$0.6152. It has support at US$0.6084 and US$0.6041.

The kiwi has been underpinned by a hawkish shift in outlook from the Reserve Bank of New Zealand (RBNZ) which forced markets to sharply scale back expectations for rate cuts.

The probability of an October easing has collapsed to just 28 per cent, from 84 per cent early in the week, while a cut in the 5.5 per cent cash rate is now not fully priced in until April next year.

“The Bank did send a rather clear signal that it does not intend to deliver rate cuts this year,” said Prashant Newnaha, a senior Asia-Pacific rates strategist at TD Securities.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

“We stick to our call for the first RBNZ cut to be delivered at its May 25 meeting.”

The hawkish turn has seen key two-year swap rates surge 22 basis points in just two sessions to reach 5.095 per cent. Yields on 10-year bonds climbed 17 basis points to 4.808 per cent.

That has attracted more carry demand as investors borrow yen at low rates to invest in the higher yielding kiwi, sending it flying to a 17-year peak of 96.11 yen.

The Aussie has also lost ground to the kiwi, sliding 0.8 per cent for the week and reaching a two-month low of NZ$1.0809.

Markets have likewise pushed out the likely timing of policy easing from the Reserve Bank of Australia (RBA), and even have a small chance the next move will be a hike.

Futures imply a limited chance of a cut until April next year, and a quarter-point move is not fully priced until July.

Much will depend on whether domestic inflation proves sticky, underling the importance of the monthly April consumer price report due next week.

Analysts at Goldman Sachs expect a rise of 0.3 per cent for the month, a step down from 0.7 per cent in March. That would see the annual pace slow to its lowest since late 2021 at 3.2 per cent, and closer to the RBA’s 2-3 per cent target band. REUTERS

Tags: AustralianCutsDefensiveDollarsMarketsRateRunZealand
Riah Marton

Riah Marton

I'm Riah Marton, a dynamic journalist for Forbes40under40. I specialize in profiling emerging leaders and innovators, bringing their stories to life with compelling storytelling and keen analysis. I am dedicated to spotlighting tomorrow's influential figures.

Next Post
Alibaba is said to price US.5 billion convertible bond sale

Alibaba is said to price US$4.5 billion convertible bond sale

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Forbes 40under40 stands as a distinguished platform revered for its commitment to honoring and applauding the remarkable achievements of exceptional individuals who have yet to reach the age of 40. This esteemed initiative serves as a beacon of inspiration, spotlighting trailblazers across various industries and domains, showcasing their innovation, leadership, and impact on a global scale.

 
 
 
 

NEWS

  • Forbes Magazine
  • Technology
  • Innovation
  • Money
  • Leadership
  • Real Estate
  • Lifestyle
Instagram Facebook Youtube

© 2024 Forbes 40under40. All Rights Reserved.

  • About Us
  • Advertise
  • Contact Us
No Result
View All Result
  • Home
  • Technology
  • Innovation
  • Real Estate
  • Leadership
  • Money
  • Lifestyle

© 2024 Forbes 40under40. All Rights Reserved.

Welcome Back!

Login to your account below

Forgotten Password?

Retrieve your password

Please enter your username or email address to reset your password.

Log In