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Weekly Roundup: Steady RBA limits Australian dollar appeal, New Zealand dollar slides on dairy price disappointment

currency-newsWeekly Roundup: Steady RBA limits Australian dollar appeal, New Zealand dollar slides on dairy price disappointment
Another uneventful Reserve Bank of Australia (RBA) policy meeting offered the Australian dollar little in the way of support, with markets seeing small chance of an interest rate hike for the foreseeable future.

While RBA policymakers maintained a relatively optimistic note the central bank looks set to remain on hold, leaving AUD exchange rates biased to the downside in the face of a stronger US dollar.

Demand for the New Zealand dollar, meanwhile, remained muted in the wake of the latest decline in prices at the Global Dairy Trade auction.

With dairy prices failing to recover ground the appeal of the commodity-correlated New Zealand dollar declined, given the significant role of dairy in the New Zealand economy.

If this week’s New Zealand retail card spending and food price index data fail to impress NZD exchange rates could shed further ground.

An improvement in the Westpac consumer confidence index may give the Australian dollar a boost, with markets likely to take comfort from signs of domestic resilience.

As long as market risk appetite remains limited, though, the potential for AUD and NZD exchange rate strength is unlikely to materially improve.
 
Philip McHugh

Philip McHugh

Joining the corporate trading desk in 2007, Phil now over sees all of Currencies Direct’s corporate dealing activity. Having gained experience working with hundreds of businesses to optimise international payments processes and execute comprehensive risk management strategies, Phil currently works with a portfolio of corporate clients whilst managing Currencies Direct’s overall market exposure

Phil has FCA approval and has completed the Certificate in International Treasury Management (CertiTM)

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