NZD/USD: The currency is trading in different directions
The New Zealand currency is moving in a weak rally, intending to recover the losses incurred the day before. At the moment the NZD/USD reached 0.6150, which has a moderate positive potential due to macroeconomic data from New Zealand and China.
Thus, the IDO (Business Optimism Index) from ANZ for August strengthened to -47.8 points from the previous -56.7 points, while experts expected the strengthening to -55.0 points. Expectations for the same period activity adjusted to -4.0% from last year's -8.7%, contrary to analysts' expectations of a decline to -8.9%. New Zealand construction approvals for July rose 5.0%, having previously shown a decline. On the whole, the level of dynamics managed to successfully surpass the experts' preliminary forecasts. The head of the RBNZ (Reserve Bank of New Zealand) confirmed the intention to conduct a twofold increase in the key indicator. The day before the officials of the agency adjusted the value for the seventh time in a row, which allowed to reach the target level of 3.00%, breaking the record for September 2015, while the value should be the previously announced 4.00%, which could effectively combat the rapid growth of consumer prices. Economists expect the monetary adjustment cycle to end by early next year.
- Resistance levels: 0.6155, 0.6200, 0.6250, 0.6300.
- Support levels: 0.6100, 0.6079, 0.6040, 0.6000.
EUR/USD: The Eurozone is reforming its electricity market
The Euro is trading moderately higher, trying to build on the bullish momentum from the week. EUR/USD intends to hold above the support threshold of 1.0000, using the uncertainty of the U.S. dollar.
As it follows from the released data the day before, the consumer price index in Germany has accelerated from the previous 7.5% to 7.9% on an annualized basis, meanwhile the monthly level fell to 0.3% from the previous 0.9%. The position of the harmonized consumer inflation index in the same period strengthened to 8.8% from 8.5%, as economists had expected. Slight fluctuations in the index were possible due to the cheapening of fuel, while the food and energy products group developed growth. Market participants are focused on the inflation data for August in the EU which was announced the day before. According to preliminary expectations the annual expression may update the record high at 9.0%.
- Resistance levels: 1.0050, 1.0100, 1.0150 and 1.0200.
- Support levels: 1.0000, 0.9950, 0.9900, 0.8950.
GBP/USD: the asset is held at lows from 2020
The British currency is trading within the ascending dynamics in pair with the US dollar, moving away from the record low updated earlier, getting ready to test the threshold of 1.1700 with the prospect of growth, wishing to use the ambiguous sentiment on the dollar.
Traders began to close long-term contracts, taking a wait-and-see attitude, wishing to assess the macro data, announced the day before. Thus, the report, announced for Wednesday, will help experts to estimate private sector employment, presented by ADP (Automatic Data Processing), and by the end of the week the official statements will be published. Preliminary expectations of employment are quite positive and this will allow the U.S. regulator to continue strengthening national currency and raise the interest rate by 0.75%.
- Resistance levels: 1.1700, 1.1759, 1.1800 and 1.1854.
- Support levels: 1.1647, 1.1600, 1.1531, 1.1480.
AUD/USD: pair is trading under pressure due to weak data
The trading instrument AUD/USD trades within the unstable dynamics, testing the level of 0.6884 against the background of the negative statistics published the day before.
Thus, the July indicators for residential real estate were released in Australia. The number of approved building applications showed a sharp decline of 17.2%, against the forecast of 5.0%, showing a second consecutive decline. Economists have already noted that this situation is due to the negative impact of monetary tightening by the national regulator. Construction projects rose 3.8% in Q2 compared to expectations of a 0.9% increase and new approvals for residential projects gained 0.7% compared to a 1.8% decline in the previous month. The negative trend has also affected the loan industry. Thus, the level of credit products sold continues to decline vigorously, amounting to 0.5% in July compared to 0.6% last month, the private sector segment has dropped from 0.9% to 0.7% due to rising loan servicing costs and rising key interest rates.
- Resistance levels: 0.6928, 0.7122.
- Support levels: 0.6847, 0.6681.