NZD Soars as Aussie Stumbles

By Tomasz Wisniewski|

Published: November 29 2023, 06:08 GMT+0

NZD Soars as Aussie Stumbles

Welcome to Wednesday’s financial analysis. Today’s economic calendar is bustling with activity, having kicked off with Australia’s lower-than-expected inflation rate at 4.9%, against the projected 5.2%. Additionally, the Reserve Bank of New Zealand maintained its interest rates at 5.5%. Later in the day, we anticipate inflation data from Germany and Spain, along with the U.S. prelim GDP, forecasted at 5%.

Focusing on the currency market, the New Zealand Dollar is emerging as the strongest, buoyed by the Reserve Bank of New Zealand’s commitment to restrictive monetary policy. Contrasting this trend, the Australian Dollar languishes as the weakest, clearly impacted by its lower inflation figures. This divergence between the two currencies, which usually move in tandem, is quite noteworthy. Meanwhile, the U.S. Dollar’s recent weakness has propelled the Euro to new highs and dragged the USD/JPY and USD/CHF pairs to new lows.

In the world of indices, Tuesday’s session closed on a bullish note, with NASDAQ notably defending its critical horizontal support at 15,900 points. This could signal a potential turning point or a continuation of the upward trend, depending on market responses in the coming sessions.

Shifting to commodities, precious metals like gold and silver have reached new mid-term highs, largely driven by the softening U.S. Dollar. Oil, while experiencing a rise, remains in a mid-term sideways trajectory. Both commodities are currently forming pennant patterns, and a breakout above these could potentially signal a buying opportunity. However, it’s crucial to wait for a confirmed breakout before making any trading decisions.