Dec 13, 2023

The AUDNZD exchange rate has data ahead as the Aussie dollar remains under pressure. 


AUDNZD – Daily Chart 

AUDNZD trades at 1.07 and may look to test the lows at 1.0645 and 1.0618. 

The New Zealand economy will see the release of GDP growth data at 6:45 HKT on Thursday, with the economy expected to show a 0.5% growth rate for the third quarter.  

That will be followed by Australian employment at 7:30 am with the Australian jobs market weakening. The Australian economy is expected to see 11k jobs added for the month, compared to 55k last month. 

BCA Research said the Reserve Bank of New Zealand will keep interest rates unchanged at 5.5% for an extended period while the market expects another rate hike. 

RBNZ rate hike bets increased last month after a more ‘hawkish’ than expected tone from policymakers due to the country’s stubborn inflation rates. 

“The tone surrounding the announcement was surprisingly hawkish,” analysts said. 

However, “the RBNZ is unlikely to deliver on that threat of additional interest rate increases in 2024,” he cautions. 

“Economic growth is averaging about 3% this year, compared to 1.8% annualised growth over the last 10 years. “That’s a pretty healthy recession we had in 2023,” joked Hogan.  

The group also believes the economy will slow in 2024 as previous interest rate hikes sink in, which should harm the New Zealand Dollar. 

“It takes between 6-9 quarters for changes in interest rates to have the maximum impact on New Zealand inflation. If that holds true in the current cycle, the greatest downward pressure on New Zealand inflation from the RBNZ’s rate hikes will begin to be felt in 2024,” BCA said. 

A deterioration in the country’s trade balance has also made it the world’s second-most expensive currency after the USD for world trade. In the near term, the data on Thursday may be a catalyst to test the recent lows and attempt to mark a bottom price for the Aussie dollar.

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