Both Australian Dollar and New Zealand Dollar are trading lower today after release of economic data.
Australia CPI rose 0.4% qoq, 2.1% yoy in Q2. The annual rate accelerated from Q1’s 1.9% yoy but missed expectation of 2.2% yoy. RBA trimmed mean CPI was unchanged at 1.9%, inline with expectation. RBA weighted median CPI slowed to 1.9% yoy, down from 2.0% yoy, matched expectation.
RBA is very clear with its stance that there is no compelling reason to raise interest rate in near term. And the inflation data certainly won’t alter that position.
New Zealand trade balance came in at surprised NZD -113m deficit in June, versus expectation of NZD 200m surplus. Exports dropped from NZD 5.35B to NZD 4.91B. Imports also dropped from NZD 5.15B to 5.02B.
AUD/NZD has been stuck in range of 1.0884/0991 since early July and there is no sign of a breakout yet. While 61.8% retracement of 1.1289 to 1.0486 at 1.0982 looks like a strong resistance. But the cross is holding above 55 day EMA as well as 1.0844 support, thus maintains near term bullishness. For now, further rise remains in favor.
